Is the nature of the gainor loss considered ordinary or long-term?

Q: What disclosure is made if a loss contingency is reasonably possible?

A: Contingent Liability: Contingent liability is one form of liability that arises based on a…

Q: WHAT IS LEGAL LIFE OF THE ASSET?

A: SOLUTION- LEGAL LIFE OR USEFUL LIFE OF ASSET- AN ASSET LEGAL LIFE IS THE PERIOD OF TIME (OR TOTAL…

Q: What are the measures used to describe possible loss accurately?

A: Furthermore, you have the option of paying for your item in equal monthly instalments, guaranteeing…

Q: What disclosures are required for remote likelihood of losses?

A: Likelihood of losses means chance of occuring loss in some future events of the business. Likelihood…

Q: What is meant by depreciable base? How is it determined?

A: Depreciable base: The word depreciable base is used to depict the value that is divided by the…

Q: or each of the following scenarios, select whether an asset has been impaired (Y for yes and at…

A: Impairment means decrease in value of asset as compared to book value. Fair value needs to be seen…

Q: How can the Gains and Losses on Depreciable Assets be determined?

A: For calculation of gains or losses on depreciable assets, written down value of the assets at the…

Q: Which asset never depreciates in value?

A: Depreciation expense: Depreciation expense is the reduction in a particular asset due to its use or…

Q: One of the main differences between U.S. GAAP and IAS/IFRS is the measurement of property, plant &…

A: Definition: IAS 16 deals provide a framework for the accounting treatment of property plant and…

Q: What are the requirements of depreciating an asset?

A: Depreciation is a non-cash expense which is charged against the use of the fixed assets of the…

Q: Minimum amortization of the actuarial loss?

A: INTRODUCTION: Amortization is the process of progressively applying an asset's cost to expenditure…

Q: why is insurance not included in the initial value of the asset?

A: Lets understand the basics.As per IAS 16 " property, plant and equipment", asset should initially…

Q: How are deductions and losses different? How are they similar? Explain

A: Deductions: As deductions, the existing expenses made for the development of current period profits…

Q: What are the measures used to describe possible loss accurately?

A: Risk is the possibility of loss on the investment and it is essential for investors to identify risk…

Q: Why does the so-called distressed property situation exist?

A: Distressed property refers to those which have value less than the market value. This situation…

Q: Determine an asset's depreciable life?

A: A tangible asset is a substantial resource. Tangible resources incorporate fixed resources including…

Q: Why certain long-lived assets are depreciated (amortized)?

A: Amortization: Over a certain length of time, the accounting practice known as amortization is…

Q: What disclosure is required for a probable loss contingency?

A: Contingent liability: This is an uncertain obligation which might be incurred on a future date as a…

Q: According to our authors, what is an unrealized gain and unrealized loss?

A: In a general view gains and losses are the outcomes of investing which are inevitable. A gain or…

Q: John Landscaping started 2018 with total assets of $23,000 and total liabilities of $13,000. At the…

A: The stockholders equity is the equity capital that is contributed by the equity stockholders as well…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.