Part 4:M. Dodge purchased a duplex on January 15, 2020 for $300,000. It is estimated $200,000 isattributable to building. The two units are identical in size, for purposes of CCA class, theproperty is considered to be a single unit.Note the following:January, 2020, purchased furniture and appliances for one of the units at a total cost of$10,000.For 2020, both units were rented, rental revenue was $30,000 and incurred expenses,other than CCA, of $9,000.In September, 2021, the tenants moved out and purchased all the furniture andappliances for 8,000.deducts the maximum.Calculate the rental income for 2020. Also, determine the UCC balances on January 1, 2022.Include in your solution any income tax consequences associated with the sale of the furnitureand appliances.

The rental income is the rental revenue less the expenses incurred. The UCC balance is the…

Calculate the rental income for 2020. Also, determine the UCC balances on January 1, 2022. Include in your solution any income tax consequences associated with the sale of the furniture and appliances.

Calculate the rental income for 2020. Also, determine the UCC balances on January 1, 2022. Include in your solution any income tax consequences associated with the sale of the furniture and appliances.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Part 4:
M. Dodge purchased a duplex on January 15, 2020 for $300,000. It is estimated $200,000 is
attributable to building. The two units are identical in size, for purposes of CCA class, the
property is considered to be a single unit.
Note the following:
January, 2020, purchased furniture and appliances for one of the units at a total cost of
$10,000.
For 2020, both units were rented, rental revenue was $30,000 and incurred expenses,
other than CCA, of $9,000.
In September, 2021, the tenants moved out and purchased all the furniture and
appliances for 8,000.
deducts the maximum.
Calculate the rental income for 2020. Also, determine the UCC balances on January 1, 2022.
Include in your solution any income tax consequences associated with the sale of the furniture
and appliances.

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