On August 1 of year 0, Dirksen purchased a machine for $37,250 to use in its business. On December 4 of year 0, Dirksen sold the machine for $30,250. Use MACRS Table. Note: 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. Problem 11-42 Part-b (Algo) b. Dirksen depreciated the machinery using MACRS (seven-year recovery period). 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?
On August 1 of year 0, Dirksen purchased a machine for $37,250 to use in its business. On December 4 of year 0, Dirksen sold the machine for $30,250. Use MACRS Table. Note: 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. Problem 11-42 Part-b (Algo) b. Dirksen depreciated the machinery using MACRS (seven-year recovery period). 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?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Problem 11-42 (LO 11-3, LO 11-4) (Algo)
[The following information applies to the questions displayed below.]
On August 1 of year 0, Dirksen purchased a machine for $37,250 to use in its business.
On December 4 of year 0, Dirksen sold the machine for $30,250. Use MACRS Table.
Note: 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.
Problem 11-42 Part-b (Algo)
b. Dirksen depreciated the machinery using MACRS (seven-year recovery period). 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?
> Answer is complete but not entirely correct.
Description
Amount
Total Gain or (Loss) Recognized
$
(2,884) X
Character of Recognized Gain or
(Loss):
Ordinary Gain or (Loss)
$
(2,884)
§1231 gain or (loss)
$
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F681b00bd-e0f8-444f-a252-6753472119c2%2F7378ed2e-89fe-458e-9185-e03de4ac0dba%2Fy11m8jc_processed.png&w=3840&q=75)
Transcribed Image Text:!
Required information
Problem 11-42 (LO 11-3, LO 11-4) (Algo)
[The following information applies to the questions displayed below.]
On August 1 of year 0, Dirksen purchased a machine for $37,250 to use in its business.
On December 4 of year 0, Dirksen sold the machine for $30,250. Use MACRS Table.
Note: 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.
Problem 11-42 Part-b (Algo)
b. Dirksen depreciated the machinery using MACRS (seven-year recovery period). 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?
> Answer is complete but not entirely correct.
Description
Amount
Total Gain or (Loss) Recognized
$
(2,884) X
Character of Recognized Gain or
(Loss):
Ordinary Gain or (Loss)
$
(2,884)
§1231 gain or (loss)
$
0
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