On August 1 of year 0, Dirksen purchased a machine for $26,250 to use in its business. On December 4 of year 0, Dirksen sold the machine for $22,250. Use MACRS Table. (Loss amounts should be Indicated by a minus sign. Do not round percentages used for calculations. Round other Intermediate computations to the nearest whole dollar amount. Leave no answer blank. Enter zero If applicable.) a.) What are the amount and character of the gain or loss Dirksen will recognize on the sale? Description Total Gain/(Loss) Recognized Character of Recognized Gain/(Loss): Ordinary Gain/(Loss) $1231 gain/(loss) Amount $(4,000) b)b. What are the amount and character of the gain or loss Dirksen will recognize on the sale if the machine is sold on January 15 of year 1 instead? Description Total Gain/(Loss) Recognized Character of Recognized Gain/(Loss): Ordinary Gain/(Loss) $1231 gain/(loss) Amount
On August 1 of year 0, Dirksen purchased a machine for $26,250 to use in its business. On December 4 of year 0, Dirksen sold the machine for $22,250. Use MACRS Table. (Loss amounts should be Indicated by a minus sign. Do not round percentages used for calculations. Round other Intermediate computations to the nearest whole dollar amount. Leave no answer blank. Enter zero If applicable.) a.) What are the amount and character of the gain or loss Dirksen will recognize on the sale? Description Total Gain/(Loss) Recognized Character of Recognized Gain/(Loss): Ordinary Gain/(Loss) $1231 gain/(loss) Amount $(4,000) b)b. What are the amount and character of the gain or loss Dirksen will recognize on the sale if the machine is sold on January 15 of year 1 instead? Description Total Gain/(Loss) Recognized Character of Recognized Gain/(Loss): Ordinary Gain/(Loss) $1231 gain/(loss) Amount
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:On August 1 of year 0, Dirksen purchased a machine for $26,250 to use in its business. On December 4 of year 0, Dirksen sold the machine for $22,250. Use MACRS Table. (Loss amounts should be Indicated by a minus
sign. Do not round percentages used for calculations. Round other Intermediate computations to the nearest whole dollar amount. Leave no answer blank. Enter zero If applicable.)
a.) What are the amount and character of the gain or loss Dirksen will recognize on the sale?
Description
Total Gain/(Loss) Recognized
Character of Recognized Gain/(Loss):
Ordinary Gain/(Loss)
$1231 gain/(loss)
Amount
$(4,000)
b)b. What are the amount and character of the gain or loss Dirksen will recognize on the sale if the machine is sold on January 15 of year 1 instead?
Description
Total Gain/(Loss) Recognized
Character of Recognized Gain/(Loss):
Ordinary Gain/(Loss)
$1231 gain/(loss)
Amount
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