Davidson Corporation owns a non-depreciable capital asset held for investment. The asset was purchased for $300,000 ten years earlier and is now subject to a $50,000 liability. During the current year, Davidson transfers the asset to Martin in exchange for $80,000 cash and a new boat with a $40,000 FMV to be used by Davidson for personal use. Martin assumes the $50,000 liability. Determine the amount of Davidson's LTCG or LTCL.
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- Davidson Corporation owns a non-depreciable capital asset held for investment. The asset was purchased for $300,000 ten years earlier and is now subject to a $50,000 liability. During the current year, Davidson transfers the asset to Martin in exchange for $80,000 cash and a new boat with a $40,000 FMV to be used by Davidson for personal use. Martin assumes the $50,000 liability. Determine the amount of Davidson's LTCG or LTCL.Yager Corporation purchased residential real estate several years ago for $225,000, of which $50,000 was allocated to the land and $175,000 was allocated to the building. Yager took straight-line MACRS deductions of $40,000 during the years it held the property. In the current year, Yager sells the property for $275,000, of which $55,000 is allocated to the land and $220,000 is allocated to the building. Requirement What are the amount and character of Yager's recognized gain or loss on the sale? Begin by computing the gain or loss on sale. Select the formula and then enter the amounts and compute the gain or loss on the sale for the land, building and for the total Land Building Total Recognized gain Next, determine the character of the gain or loss on sale of the land and building. (Complete all input fields. For items with a 0 balance, make sure to enter a 0 in the appropriate cell.) Building Total Land Recognized gain or lossYager Corporation purchased residential real estate several years ago for $245,000, of which $35,000 was allocated to the land and $210,000 was allocated to the building. Yager took straight-line MACRS deductions of $40,000 during the years it held the property. In the current year, Yager sells the property for $320,000, of which $85,000 is allocated to the land and $235,000 is allocated to the building. Requirement What are the amount and character of Yager's recognized gain or loss on the sale? Begin by computing the gain or loss on sale. Select the formula and then enter the amounts and compute the gain or loss on the sale for the land, building and for the total. Land Building Total Recognized gain Next, determine the character of the gain or loss on sale of the land and building. (Complete all input fields. For items with a 0 balance, make sure to enter a 0 in the appropriate cell.) Total Land Building Recognized gain or loss
- During the current year, TLI Corporation sells a tract of land for $90,000. The sale is made to Sophie, TLI Corporation's sole shareholder. TLI Corporation originally purchased the land five years earlier for $121,000. Read the requirements. Requirement a. What is the amount of gain or loss that TLI Corporation will recognize on the sale during the current year? First, calculate the gain or loss realized and then calculate the gain or loss recognized in the current year. (For a gain or loss with a zero value, enter $0 and select N/A.) Amount Gain or loss Gain or loss realized Gain or loss recognized Requirements a. What is the amount of gain or loss that TLI Corporation will recognize on the sale during the current year? b. Assume that in the following year, Sophie sells the land for $111,000. What is the amount of gain or loss Sophie will recognize? What are the tax consequences to TLI Corporation upon the subsequent sale by Sophie? c. Assume that in the following year, Sophie sells…Eli Incorporated, a calendar year taxpayer, purchased an apartment building on June 3, 2015 for $1,200,000, of which $200,000 was allocable to the land. The corporation sold the property on July 27, 2020. The corporation’s depreciation for the building for 2020 will be approximately: $13,894. b. $16,665. c. $18,180. d. $36,360. e. None of the other choices are correcPlease please provide correct answer accounting
- Rayburn Corporation has a building that it bought during year 0 for $850,000. It sold the building in year 5. During the time it held the building Rayburn depreciated it by $100,000. What is the amount and character of the gain or loss Rayburn will recognize on the sale in each of the following alternative situations? a. Rayburn receives $840,000. b. Rayburn receives $900,000. c. Rayburn receives $700,000.On May 15, 2020, Aldean Company, a calendar year taxpayer, purchased and placed into service a nonresidential building. The company paid $140,000 total and allocated $40,000 of the cost to the land and $100,000 of the cost to the building based on fair market values. Compute Aldean’s maximum first-year depreciation on the realty.On May 31, 2022, Javier Sanchez purchased and placed in service a new 7-year class asset costing $470,000 for use in his landscaping business, which he operates as a single member LLC (Sanchez Landscaping LLC). Rather than using bonus depreciation, Javier would like to use § 179 to expense $200,000 of this asset and then use regular MACRS to cost recover the remaining cost. During 2022, his business generated a net income of $564,000 before any § 179 immediate expense election. If required round your intermediate computations and final answers to the nearest dollar. Click here to access the depreciation table to use for this problem. a. Determine the cost recovery deductions (including first-year additional depreciation) that Javier Sanchez can claim with respect to this asset in 2022 and 2023. Total cost recovery deduction in 2022: Total cost recovery deduction in 2023: $
- During the current year, Hom donates a sculpture that cost $1,000 to a museum for exhibition. The sculpture's fair market value was $1,700 on the date of the donation, and Hom's adjusted gross income is $40,000. Assume Hom held the sculpture for 4 months and the $700 ($1,700 − $1,000) of appreciation is a short-term capital gain. Calculate the amount of his itemized deduction for the contribution. Assume Hom held the sculpture for 2 years and the $700 appreciation is a long-term capital gain. Calculate the amount of his itemized deduction for the contribution.In 2020, Gain Inc. purchased all of the assets of Cookie’sbusiness. As part of this purchase, Gain Inc. purchased thefollowing intangible assets:• $ 270,000 for a 5-year agreement in which Cookie cannotcompete with Gain.• $ 720,000 for Goodwill. Gain plans to be in business for30 years.How much will Gain Inc. deduct as amortization in 2020 if theycommence business on 4/15/20?a. $58,500b. $49,500c. $46,750d. $40,500e. $31,500Cooper Construction Company sells a used crane to Alpha Construction for $94,000. The crane, which originally cost $880,000, is fully depreciated. Under Sec. 1245 depreciation recapture rules, the entire gain is taxable as ordinary income. Cooper receives a down payment of $49,000 and is to receive $15,000 per year for three additional years plus interest of 10%, which is greater than the applicable federal rate. Read the requirements. Requirement a. Compute the gain from the sale. The gain from the sale is Requirement b. How much gain is taxable in the year of the sale? The taxable amount of the gain in the year of the sale is Requirement c. What income does Cooper report in each of the next three years? The income that Cooper Construction Company needs to report in each of the next three years is