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- MH Realty, LLC sells a parcel of waterfront land and a residential condo building with an adjusted tax basis of $100,000 and 250,000, respectively for $500,000. The original purchase price MH allocated to the building was $600,000. MH has deducted $350,000 in depreciation expense. MH's realized gain is $150,000. If MH takes back a note as part of the proceeds, what is MH's gross profit percentage? A. 83.33%. B. 71.43%. C. 70.00%. D. 50.00%. E. 30.00%.! Required information [The following information applies to the questions displayed below.] Hart, an individual, bought an asset for $500,000 and has claimed $100,000 of depreciation deductions against the asset Hart has a marginal tax rate of 32 percent. Answer the questions presented in the following alternative scenarios (assume Hart had no property transactions other than those described in the problem): Note: Loss amounts should be indicated by a minus sign. Enter NA if a situation is not applicable. Leave no answers blank. Enter zero if applicable. Required: d1. What are the amount and character of Hart's recognized gain or loss if the asset is a nonresidential building sold for $450,000? d2. What effect does the sale have on Hart's tax liability for the year? Answer is complete but not entirely correct. Complete this question by entering your answers in the tabs below. Required d1 Required d2 What effect does the sale have on Hart's tax liability for the year? Tax liability…Need Help with this Question
- 1. A special manufacturing and handling device was purchased by Alfonso Manufacturing for $200,000 and is depreciated over MACRS. CFBT is estimated to amount to $800,000 for the first 2 years followed by $600,000 thereafter until the asset is retained. The effective tax rate, Te is 35% and interest is 10% per year. In present worth dollars determine the CFAT and determine if it was a viable purchase. (Note answer must be in a tabular format)McFadden Company owns equipment with a cost of $475,000 and accumulated depreciation of $280,000 that can be sold for $175,000, less a 7% sales commission. Alternatively, McFadden Company can lease the equipment for four years for a total of $180,000, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by McFadden Company on the equipment would total $35,500 over the four-year lease. a. Prepare a differential analysis on February 18 as to whether McFadden Company should lease (Alternative 1) or sell (Alternative 2) the equipment. Differential Analysis Lease Equipment (Alt. 1) or Sell Equipment (Alt. 2) February 18 Revenues Costs Income (Loss) Lease Equipment Sell Equipment (Alternative 1) (Alternative 2) Differential Effect on Income (Alternative 2)A firm purchased $62,800 of fixed assets two years ago. The company no longer needs these assets so it is going to sell them today for $28,500. The assets are classified as five-year property for MACRS. The MACRS rates are .2, .32, .192, .1152, .1152, .0576, for Years 1 to 6, respectively. What is the net cash flow from this sale if the firm's tax rate is 23 percent and no bonus depreciation is taken? $29,281.04 $26,576.00 $28.878.12 $27,516.60 O $29,648.12
- (d) If the old machine is sold for $5,000 now instead of $2,500, what would be the amount of the gains tax?(e) If the old machine had been depreciated by 175% DB and then by a switch to SL depreciation, what would be the current book value?(f) If the old machine were not replaced by the new one and has been depreciated by the 175% DB method, when would be the time to switch from DB to SL depreciation'?AsapDuring 2009, Aisin Seiki Limited sold 2,000 square meters of prime commercial zoned land to a builder for ¥5,000,000. The builder gave Aisin Seiki Limited a ¥1,000,000 down payment and will pay the remaining balance of ¥4,000,000 to Aisin Seiki Limited in 2010. Aisin Seiki Limited purchased the land in 2002 for ¥3,000,000. Using the installment method, how much profit will Aisin Seiki Limited report for 2009 (in Japanese Yen, \)? Select one: O a. 600,000 b. 400,000 O c. 1,000,000 O d. 3,000,000 e. 0
- Russell Corporation sold a parcel of land valued at $442,500. Its basis in the land was $274,350. For the land, Russell received $76,500 in cash in year 0 and a note providing that Russell will receive $265,000 in year 1 and $101,000 in year 2 from the buyer. (Do not round intermediate calculations. Round your final answers to the nearest whole dollar amount.) a. What is Russell's realized gain on the transaction? b. What is Russell's recognized gain in year 0, year 1, and year 2?1. Lease or Sell Astro Company owns a equipment with a cost of $365,000 and accumulated depreciation of $52,200 that can be sold for $275,000, less a 4% sales commission. Alternatively, Astro Company can lease the equipment to another company for three years for a total of $285,800, at the end of which there is no residual value. In addition, the repair, insurance, and property tax expense that would be incurred by Astro Company on the equipment would total $16,300 over the three years. 2. Discontinue a Segment Product T has revenue of $195,400, variable cost of goods sold of $116,100, variable selling expenses of $33,900, and fixed costs of $58,500, creating a loss from operations of $13,100. Prepare a differential analysis as of May 9, to determine whether Product T should be continued (Alternative 1) or discontinued (Alternative 2), assuming fixed costs are unaffected by the decision. If an amount is zero, enter "0". For those boxes in which you must enter subtracted or…OCD exchanged old realty for new like-kind realty. OCD’s adjusted basis in the old realty was $31,700 ($60,000 initial cost − $28,300 accumulated depreciation), and its FMV was $48,000. Because the new realty was worth only $45,000, OCD received $3,000 cash in addition to the new realty. Required: a-1. Compute OCD's realized gain. a-2. Determine the amount and character of any recognized gain. b. Compute OCD’s basis in its new realty.