Solve this accounting questions BlueSky Corp. sold manufacturing equipment with a $45,600 adjusted taxbasis for $160,000 in 2009. The buyer paid $70,000 in cash and issued anote for the remaining $90,000. BlueSky is using the installment salemethod to recognize the gain. In 2012, after receiving $35,000 in principalpayments on the note, BlueSky sold the remaining balance of the note toa bank for $55,000. Calculate BlueSky's recognized gain on the sale ofthe installment note in 2012.A. $0 B.B. $42,500C. $39,325D. $55,000E. $34,925

Step 1: Definition of Installment Sale MethodThe Installment Sale Method is a tax reporting approach…

Answered: BlueSky Corp. sold manufacturing…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter11: Property Dispositions

Section: Chapter Questions

Problem 84TA

See similar textbooks

Similar questions

On January 1, 2008, Rex Co. sold a used machine to Lake, Inc. for P525,000. On this date, the machine had a depreciated cost of P367,500. Lake paid P75,000 cash on January 1, 2008 and signed a P450,000 note bearing interest at 10%. The note was payable in three annual installments of P150,000 beginning January 1, 2009. Rex appropriately accounted for the sale under the installment method. Lake made a timely payment of first installment on January 1, 2009 of P195,000, which included interest of P45,000 to date of payment. At December 31, 2009, Rex had deferred gross profit of
On January 2, 2009, Blake Co. sold a used machine to Cooper Inc. for P900,000 resulting to a gain of P270,000. On that date, Cooper paid P150,000 cash and signed a P750,000 note bearing interest at 10%. The note was payable in three annual installments of P250,000 beginning January 2, 2010. Blake appropriately accounted for the sale under the installment method. Cooper made a timely payment of the first installment on January 2, 2010, of P325,000, which included accrued interest of P75,000. What amount of deferred gross profit should Blake report at December 31, 2010?
On January 2, 2009, Colt Co. sold land that cost P600,000 for P800,000, receiving a note bearing interest at 10%. The note willI be paid in three annual instalments of P321,700 starting on December 31, 2009. Because collection of the note is very uncertain, Colt will use the cost recovery method. How much revenue from this sale should Colt recognize in 2009?
please solve this
Do all parts otherwise I will give you downvote
On January 1, 2020, Billy Company sold equipment that originally cost $5,000,000 to Selecta Company. As payment, Selecta gave Crawford a $7,000,000 note. The note bears an interest rate of 4% and is to be repaid in three annual installments plus interest on the outstanding balance. The first payment is due on December 31, 2020. The market price of the land is not readily determinable. The prevailing rate of interest for notes of this type is 8%. Determine the unamortized premium/discount balance on December 31, 2021
On January 1, 2020, Billy Company sold equipment that originally cost $5,000,000 to Selecta Company. As payment, Selecta gave Crawford a $7,000,000 note. The note bears an interest rate of 4% and is to be repaid in three annual installments plus interest on the outstanding balance. The first payment is due on December 31, 2020. The market price of the land is not readily determinable. The prevailing rate of interest for notes of this type is 8%. What Amount of Interest income, if any, should be included in Billy's 2020 income statement?
provide the answer
On January 1, 2015, Jantzen Company sold land to Dansko Company. There was no established market price for the land. Dansko gave Jantzen a CHF2,400,000 Zerointerest- bearing note payable in three equal annual installments of CHF800,000 with the first payment due December 31, 2015. The note has no ready market. The prevailing rate of interest for a note of this type is 10%. The present value of a CHF2,400,000 note payable in three equal annual installments of CHF800,000 at a 10% rate of interest is CHF1,989,600. The note will be reported on Dansko's 2015 statement of financial position at a carrying value of a. CHF1,989,600 b. CHF2,126,400 c. CHF2,188,560 d. CHF2,400,000
[The following information applies to the questions displayed below.] On January 1, 2018, Brown Co. borrowed cash from First Bank by issuing a $100,000 face value, four-year term note that had an 8 percent annual interest rate. The note is to be repaid by making annual cash payments of $30,192 that include both interest and principal on December 31 of each year. Brown used the proceeds from the loan to purchase land that generated rental revenues of $52,000 cash per year. b. Organize the information in accounts under an accounting equation. (Round your answers to the nearest whole dollar amount. Enter any decreases to account balances with a minus sign. If there is no effect on the Accounts Titles / Retained Earnings, leave the cell blank.) BROWN CO. Effect of Events on the Accounting Equation 2018, 2019, 2020 and 2021 Stockholders Equity Retained Earnings Assets = Liabilities Accounts Titles / Event Retained Earnings Notes Payable Cash Land 2018 1/1 1/1 %3D 12/31 12/31 Bal. 2019 Beg.…
On January 1, 2016, Cougar Company purchased a piece of machinery and signed a zero-interest-bearing note in payment. The note requires Cougar to pay 100,000 in three years. The interest rate that properly reflected the time value of money at the time was 5% and an equipment dealer in St. Louis sells the identical piece of machinery for $86,000. Cougar expected the machinery to have an 8 year useful life, and $6,000 salvage value. Cougar depreciated the machine using the straight-line method. On June 30, 2018, Cougar exchanged the machinery for a newer model. In addition to the old equipment, Cougar paid $10,000 cash. At the time of the exchange, the old machinery had a fair value of $70,000. Prepare the journal entry to record this exchange, assuming the arrangement has commercial substance. Prepare the journal entry to record the exchange, assuming the arrangement lacks commercial substance. ICHY-
Danica Corporation sold one of its buildings on January 1, 2007 for P20,000,000. Danica received a cash down payment of P5,000,000 and a 5-year, 10% note for the balance of P15,000,000. The note is payable in equal annual payments of principal and interest of P3,957,000 payable on December 31 of each year until the year 2011. What amount is to be reported as current notes receivable on December 31, 2008? A. 2,457,000 B. 2,702,700 C. 2,972,970 D. 3,000,000

SEE MORE QUESTIONS

Recommended textbooks for you

CONCEPTS IN FED.TAX., 2020-W/ACCESS

Accounting

ISBN:

9780357110362

Author:

Murphy

Publisher:

CENGAGE L

SWFT Comprehensive Volume 2019

Accounting

ISBN:

9780357233306

Author:

Maloney

Publisher:

Cengage

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

CONCEPTS IN FED.TAX., 2020-W/ACCESS

Accounting

ISBN:

9780357110362

Author:

Murphy

Publisher:

CENGAGE L

SWFT Comprehensive Volume 2019

Accounting

ISBN:

9780357233306

Author:

Maloney

Publisher:

Cengage

EBK CONTEMPORARY FINANCIAL MANAGEMENT

Finance

ISBN:

9781337514835

Author:

MOYER

Publisher:

CENGAGE LEARNING - CONSIGNMENT

SEE MORE TEXTBOOKS