General accounting question and right solution Lucas Corporation had a $15,000 gain on the sale of stockpurchased two years ago, a $6,000 loss on selling stock heldfor only 4 months, a $3,000 loss on the sale of officefurniture used for personal purposes, and a $4,000 loss fromthe sale of land used in their business (owned for fiveyears). Lucas had no other property transactions this year.What will be the net effect of these transactions on Lucas'stax return, in terms of gains and/or losses?

1. Capital Gains and Losses:$15,000 gain on stock (held for two years): This is a long-term capital…

Answered: Lucas Corporation had a $15,000 gain on…

SWFT Individual Income Taxes

43rd Edition

ISBN:9780357391365

Author:YOUNG

Publisher:YOUNG

Chapter20: Corporations And Parterships

Section: Chapter Questions

Problem 35P

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Comparative financial statements for Weaver Company follow: Weaver Company Comparative Balance Sheet at December 31 This Last Year Year Assets Cash 10 $ 12 Accounts receivable 295 229 Inventory 150 194 Prepaid expenses Total current assetS 464 441 Property, plant, and equipment Less accumulated depreciation 509 431 (80) (70) Net property, plant, and equipment 429 361 Long-term investments 28 34 Total assets $ 921 $836 Liabilities and Stockholders' Equity Accounts payable $ 304 $226 Accrued liabilities 70 80 Income taxes payable 71 65 Total current liabilities 445 371 Bonds payable 198 171 Total liabilities 643 542 Common stock 161 201 Retained earnings 117 93 Total stockholders' equity 278 294 Total liabilities and stockholders' equity $ 921 $836 Weaver Company Income Statement For This Year Ended December 31 Sales $752 447 Cost of goods sold Gross margin 305 223 Selling and administrative expenses Net operating income Nonoperating items: Gain on sale of investments Loss on sale of…
During this year, Weaver sold some equipment for $20 that had cost $40 and on which there was accumulated depreciation of $16. In addition, the company sold long-term investments for $10 that had cost $3 when purchased several years ago. Weaver paid a cash dividend this year and the company repurchased $40 of its own stock. This year Weaver did not retire any bonds. 2. Using the information from Part 1, along with an analysis of the remaining balance sheet accounts, prepare a statement of cash flows for this year. (List any deduction in cash and cash outflows as negative amounts.)
During the year, Irv had the following transactions: Long-term loss on the sale of business use equipment $7,000 Long-term loss on the sale of personal use camper 6,000 Long-term gain on the sale of personal use boat 3,000 Short-term loss on the sale of stock investment 4,000 Long-term loss on the sale of land investment 5,000 How are these transactions handled for income tax purposes?
Brandon, an individual, began business four years ago and has never sold a §1231 asset. Brandon owned each of the assets for several years. In the current year, Brandon sold the following business assets: Asset Original Cost $ 30,000 10,000 90,000 Accumulated Depreciation $ 7,000 6,000 20,000 Gain/Loss Machinery $ 10,000 Computers (2,000) Building (2,000) Assuming Brandon's marginal ordinary income tax rate is 32 percent, what effect do the gains and losses have on Brandon's tax liability?
Margaret Lindley paid $15,190 of interest on her $301,900 acquisition debt for her home (fair market value of $501,900), $4,190 of interest on her $30,190 home-equity debt used to buy a new boat and car, $1,190 of credit card interest, and $3,190 of margin interest for the purchase of stock. Assume that Margaret Lindley has $10,190 of interest income this year and no investment expenses. How much of the interest expense may she deduct this year? $23,760 $22,570 $19,380 $18,380 None of the choices are correct.
This year, Marcus sold the following assets: Stock 1 held for 10 years: $368 gain Stock 2 held for 3 years: $9,157 loss What amount of net capital loss can Marcus deduct this year? Enter your answer as a negative number.
Margaret Lindley paid $15,160 of interest on her $301,600 acquisition debt for her home (fair market value of $501,600), $4,160 of interest on her $30,160 home- equity debt used to buy a new boat and car, $1,160 of credit card interest, and $3,160 of margin interest for the purchase of stock. Assume that Margaret Lindley has $10,160 of interest income this year and no investment expenses. How much of the interest expense may she deduct this year? Multiple Choice O₁ O $23,640 $22,480 $19,320 $18,320 None of the choices are correct.
Case A Mr. Dorne had an employment income of $50,000 and an interest income of $12,000. His unincorporated business lost $23,000 during this period. As the result of dispositions of capital property, he had taxable capital gains of $95,000 and allowable capital losses of $73,000. His Subdivision e deductions for the year totaled $8,000. He also experienced a loss of $5,000 on a rental property that he has owned for several years. Case B Mr. Dorne had an employment income of $45,000, a net rental income of $23,000, and a loss from his unincorporated business of $51,000. As the result of dispositions of capital property, he had taxable capital gains of $25,000 and allowable capital losses of $46,000. His Subdivision e deductions for the year amounted to $10,500. Fortunately for Mr. Dorne, he won $560,000 in a lottery on February 24. Required: For both Cases, calculate Mr. Dorne’s Net Income For Tax Purposes (Division B income). Indicate the amount and type of loss carryovers that…
Rahul
Sumner sold equipment that it uses in its business for $31,400. Summer bought the equipment a few years ago for $79,300 and has claimed $39,650 of depreciation expense. Assuming that this is Sumner's only disposition during the year, what is the amount and character of Sumner's gain or loss?
Dineshbhai
During the current year, Jean and Steve sold the following assets and made the following gains and losses. Capital asset. Capital gain/loss. Type A stock. $35,000. long 0/15/20% B stock. (8,000). short Antiques. 5,000. long 28% Rental home. 100,000. long 25% and 0/15/20% *40,000 of the gain is 25 percent gain from accumulated depreciation on the property. i)Complete the capital gains and losses netting process and determine the maximum tax rates applicable to the gains. ii) Given that Jean and Steve have taxable income of $450,000 before considering the sales above, what is their gross tax liability for 2021 assuming they file a joint return?

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