In 2021 an investor sold capital property for $80,000. The cost base of the property was $55,000. The investor agreed to the following payment schedule: $35,000 in 2021, $25,000 in 2022 and $20,000 in 2023. The investor elects to use the deferred proceeds method to report taxable income from this sale. How much would be the taxable capital gain reported by the investor in 2021? A. $20,000 B. $14,063 C. $10,938 D. $10,000 E. None of the above

In 2021 an investor sold capital property for $80,000. The cost base of the property was $55,000. The investor agreed to the following payment schedule: $35,000 in 2021, $25,000 in 2022 and $20,000 in 2023. The investor elects to use the deferred proceeds method to report taxable income from this sale. How much would be the taxable capital gain reported by the investor in 2021? A. $20,000 B. $14,063 C. $10,938 D. $10,000 E. None of the above

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Ashvinbhai
Job purchased land as an investment on January 12, 2018, for $80,000. On January 31, 2021, Job sold the land for $33,000 cash. In addition, the purchaser assumed the mortgage of $62,000 on the land. What is the amount realized (not gain realized) on the sale of the land? a.$10,000 b.$23,000 c.$95,000 d.$103,000 e.None of these choices are correct.
17. Mr. Panicker is the owner of house property whose municipal valuation is 55,000 (Not covered by Rent control Act). The construction of the property started on 2nd March 2015 and completed on 31st December 2019. The building consists of three flats and let it outs for Mr. A. B and C on an annual rent of 20,000 each. Determine the annual value of the house if Mr. A and B used the house for residential purposes and C for business purposes. The owner paid the municipal tax for all the units which amount to 8, 000. (Ans. A.V. of the house 52,000.) rty of Raju , Heis rond case Income Caju by virtue of 18. Compute the income from house property from the following information. Fair rent 36,000 Let out 3,500 p.m
Please explain in detail
8. During 2023, Phoenix purchased 5-year tangible personal property totaling $2,500,000. The half-year convention applies for 2023. Phoenix would like to claim the maximum amount of depreciation possible. What is the maximum depreciation deduction for the year assuming he has sufficient taxable income and his deduction is not limited? a) $500,000 b) $1,160,000 c) $1,428,000 d) $2,285,600
On June 7, 2006, Hawk Corporation sold a tract of land for P70,000 that resulted in a P30,000 gain on the sale. Hawk agreed to accept one payment of P35,000 on August 15 and a second payment of P35,000 on December 15. Hawk had a calendar year-end. What amount of gain was reported during the second, third, and fourth quarters of the year from this sale? P30,000, P0 and P0. P10,000, P10,000 and P10,000. P0, P15,000 and P15,000. P7,500 for each of four quarters.
Would you please explain how to find the minimum taxable capital gain to be reported in Year 2? sold capital property in Year 1 for net proceeds of $500,000. The property has an adjusted cost base of $100,000. C received $200,000 at the time of the sale and a note for the balance to be paid in equal annual instalments over the following three years. What is the minimum taxable capital gain to be reported in Year 2?
Angel Company purchased an investment property on January 1, 2018 for P3,500,000. The property had a useful life of 50 years and on December 31, 2020 had a fair value of P5,700,000. On December 31, 2020, the property was sold for net proceeds of P 6,000,000. The entity used the cost model to account for the investment property. What amount of gain or loss should be recognized for 2020 regarding the disposal of the property? *
For calendar year 2022, Stuart and Pamela Gibson file a joint return reflecting AGI of $350,000. Their itemized deductions are as follows: Note: All expenses are before any applicable limitations, unless otherwise noted. Casualty loss in a Federally declared disaster area (not covered byinsurance; before the 10%-of-AGI limitation but after the $100 floor) $48,600 Home mortgage interest (loan qualifies as acquisition indebtedness) 19,000 Credit card interest 800 Property taxes on home 16,300 Charitable contributions 28,700 State income tax 18,000 Tax return preparation fees 1,200 Round your intermediate computations to nearest whole dollar. Calculate the amount of itemized deductions the Gibsons may claim for the year.
In 2021, Zhang recognized a $45,000 gain on the sale of Section 1231 property. Over the previous five-year period, Zhang recognized the following net Section 1231 gains and (losses):2020 ($28,000)2019 $16,0002018 ($30,000)Zhang's 2021 gain is characterized asMultiple ChoiceA.$45,000 capital gainB.$42,000 ordinary gain and $3,000 capital gainC.$28,000 ordinary gain and $17,000 capital gainD.$45,000 ordinary gain
Yousuf was granted a loan of GBP 9800 by his employer on 1 may, 2019 to help finance the purchase of an asset. Interest is payable on the loan at 1.5% p.a. On 1 June 2019, Yousuf repaid GBP 5000. The remaining was still outstanding on 5 April 2020. Calculate taxable benefita. NILb. 5000c. None of the above optionsd. 4800
Boot Realty LLC receives cash of $75,000 upon completing a Section 1031 exchange. The cash received will be treated as: A long-term gain. Taxable. Reduction in the basis of the replacement property. A deferment until the replacement property is sold. Closing costs payment.