ACTG

Inky is giving up his building (AB 90, FV 100) and inventory (AB 8, FV 10). He is receiving a building (AB to original owner 110, FV 107) and cash 3. Question 36 (1 ) Listen In this exchange, the amount realized is A and the total realized gain or loss (place parentheses around your answer if there is a realized loss) is Question 37 (0 40 Listen The total recognized gain or loss amount (place parentheses around your answer if there is a recognized loss) is Question 38 ( Listen The adjusted basis in the building received is

1 Suppose the taxpayer originally purchased the machinery by paying $12,000 in cash and giving the seller a note for $12,000. When she sold it she received $38,000 in cash and the buyer assumed the $12.000 note. a. What is the amount realized? b. What is the adijusted basis of the machinery? c. What is the gain on the sale of the machinery?

True or False. What's the answer for this?  S1 - Seller sold land classified as capital asset to Buyer. Seller paid the 6% capital gains tax and handed the CGT return to Buyer. In this case, Buyer can successfully ask the register of deeds to transfer the tile of the land to his name.  S2 - Mortgagee-creditor foreclosed the real estate mortgage over land (capital asset) executed by mortgagor-debtor. Mortgagee-creditor is the highest bidder and paid P1,000,000. Within 1 year, mortgagor exercised his right of redemption. In this case, mortgagor-debtor is not subject to capital gains tax.

2 A transfers land to Newco in exchange for 100% of Newco's stock. The land has a basis of $50, FMV of $100 and is subject to a mortgage of $40. a. What are the consequences to each of the parties? b. Suppose in that the mortgage was placed on the property immediately before the transfer to Newco. A wanted cash in order to buy a yacht to be used for personal purposes, so he took out a mortgage on the land. Would this change your answer? c Suppose instead that the mortgage was for $60. Suppose further that this mortgage was incurred on the purchase of the property many years ago. Would this change your answer? d. Same as (c) except that A also transfers accounts payable of $10. A is a cash basis taxpayer. How would this change your answer?

2 A transfers land to Newco in exchange for 100% of Newco's stock. The land has a basis of $50, FMV of S100 and is subject to a mortgage of $40. a. What are the consequences to each of the parties? b. Suppose in that the mortgage was placed on the property immediately before the transfer to Newco. A wanted cash in order to buy a yacht to be used for personal purposes, so he took out a mortgage on the land. Would this change your answer?

Virginia has business property that is stolen and partially destroyed by the time it was recovered. She receives an insurance reimbursement of $5,000 on property that had a $14,000 basis and a decrease in market value of $10,000 due to damage caused by the theft. What is the amount of Virginia's casualty loss? a.$4,000 b.$5,000 c.$14,000 d.$10,000 e.None of these choices are correct.

Required information Problem 11-50 (LO 11-5) (Algo) [The following information applies to the questions displayed below.] Aruna, a sole proprietor, wants to sell two assets that she no longer needs for her business. Both assets qualify as §1231 assets. The first is machinery and will generate a $32,500 §1231 loss on the sale. The second is land that will generate a $7,800 §1231 gain on the sale. Aruna's ordinary marginal tax rate is 32 percent. (Input all amounts as positive values.) Problem 11-50 Part-b (Algo) b. Assuming that Aruna sells the land in December of year 1 and the machinery in January of year 2, what effect will the sales have on Aruna's tax liability for each year? Aruna's tax will Aruna's tax will increase decrease in year 1 by in year 2 by

Accounting When you dispose of a property and end up with a gain or a loss, it may be treated in one of 2 ways. What are they? When you dispose of personal-use property, you usually do not have a capital gain. Why not? To calculate any capital gain or loss, you need to know the following 3 amounts: the proceeds of disposition the adjusted cost base (ACB) the outlays and expenses incurred to sell your property Using these three amounts, what is the formula to calculate your capital gain or loss? 4. Capital Gains are reported on Schedule 3. What line does the sale of Personal Use Property go on?

2 A transfers land to Newco in exchange for 100% of Newco's stock. The land has a basis of $50, FMV of S100 and is subject to a mortgage of $40. b. Suppose in that the mortgage was placed on the property immediately before the transfer to Newco. A wanted cash in order to buy a yacht to be used for personal purposes, so he took out a mortgage on the land. Would this change your answer?

A made a donation to B. Later, A contracted several debts. What A has left as assets are much less than his present liabilities. May the donation be rescinded?  a. No, donation is valid. b. Yes, because the assets left are much less compared to his liabilities. c. No, there are sufficient assets to pay debts d. No, assets left are no important.   2. X sold his house valued at P500,000.00 for only P300,000.00 because X did not know the true value of his house. Is the sale rescissible? a. No, the sale is valid. Amount of consideration is immaterial. There are no other facts stated if X has debts. b. Yes, the amount of sale is lower than the market value. c. Yes, X failed to pay first his debts. d. Yes, the sale is rescissible because it is made in fraud of creditors.

! Required information Problem 11-50 (LO 11-5) (Algo) [The following information applies to the questions displayed below.] Aruna, a sole proprietor, wants to sell two assets that she no longer needs for her business. Both assets qualify as §1231 assets. The first is machinery and will generate a $22,500 §1231 loss on the sale. The second is land that will generate a $7,400 §1231 gain on the sale. Aruna's ordinary marginal tax rate is 32 percent. Note: Input all amounts as positive values. Problem 11-50 Part-b (Algo) b. Assuming that Aruna sells the land in December of year 1 and the machinery in January of year 2, what effect will the sales have on Aruna's tax liability for each year? Aruna's tax will Aruna's tax will in year 1 by in year 2 by

77 Week 5 Discussion Forum Umair sold some equipment he used in his business in 8/29/19 that was originally purchased for $65,000 on 11/21/18. The equipment was depreciated using the 7 yr MACRS method for a total of $17,249. Assume there is no additional netting of gains and losses for this taxpayer: Assume Umair sold the equipment for $45,000: 1. What is the amount of realized gain or loss on the sale of equipment? 2. Is the nature of the gain or loss considered ordinary or long term?

Statement 1: The value of property acquired by gift, bequest, devise, or descent, as well as the income from such property, shall be excluded from the gross taxable income of the recipient. Statement 2: Gains realized from the sale or exchange or retirement of bonds, debentures, or other certificates of indebtedness with a maturity of at least 5 years, shall not be taxable to the investor-seller. a. Statement 1 is trueb. Statement 2 is truec. Both Statements are falsed. Both statements are true

Maud exchanges a rental house at the beach with an adjusted basis of $225,000 and a fair market value of $200,000 for a rental house at the mountains with a fair market value of $180,000 and cash of $20,000. What is the recognized gain or loss?     a. ($20,000)   b. ($25,000)   c. None of these   d. $20,000   e. $0

Hw.19.   Sophia sold a painting that she held as an investment on an online auction website for $100. She bought the painting for $20 at a garage sale years ago. Sophia should report what amount as a capital gain on her Schedule D (Form 1040)? A. $0 B. $20 C. $80 D. $100

Hauswirth Corporation sold (or exchanged) a warehouse in year O. Hauswirth bought the warehouse several years ago for $89,000, and it has claimed $24,400 of depreciation expense against the building. Note: Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Round your final answers to the nearest whole dollar amount. Required: A. Assuming that Hauswirth receives $80,600 in cash for the warehouse, compute the amount and character of Hauswirth's recognized gain or loss on the sale. B. Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $80,600, compute Hauswirth's realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land. C. Assuming that Hauswirth receives $35,500 in cash in year 0 and a $81,500 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1. c

Exercise 8-7 (Algorithmic) (LO. 6, 7) Jacob purchased business equipment for $114,300 in 2017 and has taken $68,580 of regular MACRS depreciation. Jacob sells the equipment in 2020 for $51,435. What is the amount and character of Jacob's gain or loss? If an amount is zero, enter "0". Jacob has § 1245 gain of $ and § 1231 gain of $