Peyton sells an office building and the associated લંડ on May 1, please give answer this accounting question Peyton sells an office building and the associated land on May 1,2015. Under the terms of the sales contract, Peyton is to receive$2,351,200 in cash. The purchaser is to assume Peyton's mortgage of$1,410,720 on the property. To enable the purchaser to obtainadequate financing, Peyton is to pay the $141,072 in points chargedby the lender. The broker's commission on the sale is $94,048. Thepurchaser agrees to pay the $28,214 in property taxes for the entirecalendar year.What is Peyton's amount realized?

To calculate Peyton's amount realized, we sum up the total consideration received and subtract any…

Answered: Peyton sells an office building and the…

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter9: Acquisitions Of Property

Section: Chapter Questions

Problem 34P

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Zahava Corporation sells equipment to Ari Company for $700,000. Ari does not need the equipment until December 31, 2021, but agrees to pay $600,000 immediately on December 31, 2019, in order to assist Zahava with finances. The remaining $100,000 is due upon delivery on December 31, 2021. Zahava typically can borrow at 5%. 1. Prepare the journal entry Zahava makes to record the receipt of $600,000 on December 31, 2019. 2. Prepare the jornal entry, if any, Zahava makes in 2020. 3. Prepare the journal entry Zahava makes to record delivery of the goods and collection of the remaining $100,000 on December 31, 2021.
On January 1, 2018, Laramie Inc. acquired land for $6.2 million. Laramie paid $1.2 million in cash and signed a 6% note requiring the company to pay the remaining $5 million plus interest on December 31, 2019. An interest rate of 6% properly reflects the time value of money for this type of loan agreement. For what amount should Laramie record the purchase of land?
On January 1, 2019, Fulton Inc. enters into a contract with Gibson to deliver goods. Gibson pays $100,000 at the time the contract is signed, at which time the goods are transferred and Fulton’s performance obligation is complete. In addition, Gibson agrees to pay Fulton $100,000 on December 31, 2019, and December 31, 2020. If Fulton entered into a financing arrangement with Gibson it would charge an interest rate of 9%. Please assist with the journal entries. Thank you! There are 8 journal entries in all.
TBTF Incorporated rents commercial real state to locally based businesses. TBTF purchased a large office complex on January 2, 2022. In exchange for the real estate, TBTF issued a noninterest bearing note to the seller. This note will be paid in equal instalments that include both principal and interest at the end of each calendar year. Other information pertaining to the purchase of the real estate follows: Annual instalment payment amount Market rate of borrowing for TBTF Number of years note will be outstanding Portion of the purchase price to be allocated to land Portion of the purchase price to be allocated to land improvements $ 253,134 8% 9 24% 14% TBTF has a year end date of December 31. Required: Prepare the journal entries required by TBTF to account for the note on each of the following dates: January 2, 2022 December 31, 2024
Al paid $700 for a vehicle at Honest Bob's Cars. Al signed a $500 instalment agreement after paying $200 in cash. The complete agreement read as follows: "January 15, 2018 I commit to pay to the order of Honest Bob's Cars the sum of $500 in 10 equal payments." (signed) Al Tom accepted the instrument after Honest Bob's negotiated a fair price with him. Al wants his down payment, the first two monthly payments, and to stop making any more payments when the refrigerator stopped working after he had made two instalments. What outcome?
Simon Sharpe executed and delivered to Ben Bates a negotiable promissory note payable to the order of Ben Bates for $500. Bates indorsed the note “Pay to Carl Cady upon his satisfactorily repairing the roof of my house, (signed) Ben Bates” and delivered it to Cady as a down payment on the contract price of the roofing job. Cady then indorsed the note and sold it to Timothy Tate for $450. What rights, if any, does Tate acquire in the promissory note?
On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major customer in exchange for used equipment. The equipment had originally cost Park 200,000 and had a book value of 20,000 on the date of the sale. At the 12% imputed interest rate for this type of loan, the present value of the note is 25,500 on January 1, 2019. Park uses the effective interest rate. What is the carrying value of the note receivable on Parks December 31, 2019, balance sheet? a. 28,560 b. 29,000 c. 32,500 d. 36,000
On 1 July 2019, Cassblanka Ltd sells a construction vehicle to Tradon Ltd. The vehicle cost Cassblanka Ltd $19,500. Rather than selling the item for a cash price or a short-term claim for cash of $22,500, Cassblanka Ltd accepts a promissory note that requires Tradon Ltd to make five annual payments of $5,000 each, the first one to be made on 30 June 2020. The difference between the gross receipts and the current sales price represents interest revenue to be earned by Cassblanka Ltd over the period of the note. The implicit interest in the arrangement is 10 per cent. Required: Provide the necessary journal entries for Cassblanka Ltd for the year ended 30 June 2020 and 30 June 2021 to record the selling of construction vehicle.
On June 30, 2021, Kimberly Farms purchased custom-made harvesting equipment from a local producer. In payment, Kimberly signed a noninterest-bearing note requiring the payment of $60,000 in two years. The fair value of the equipment is not known, but an 8% interest rate properly reflects the time value of money for this type of loan agreement. At what amount will Kimberly initially value the equipment? How much interest expense will Kimberly recognize in its income statement for this note for the year ended December 31, 2021?
A buyer is purchasing a home for $200,000. The closing date is on June 15, 2023 and the buyer is responsible for all costs on the closing date. The buyer provided $5,000 as a deposit that is being held in escrow and is obtaining a loan for $180,000. The seller has a mortgage on the property with an outstanding balance of $92,000. Total settlement charges for the buyer is $7,200 and for the seller is $12,000. The county taxes for 2022 are due on November 1 and have not been paid. The total county tax amount due for the year is $4,380. The home inspection report indicated the A/C unit will need repaired and the seller has agreed to provide a $1,000 credit to the buyer, which the lender has approved.
Riker receives $45,000 from Troy as payment for a vehicle that has a fair value of $56,500. The $45,000 constitutes full payment for the vehicle as specified in the sales contract. Assume that the time value of money is viewed as significant for this contract. Required: (a) Did Troy pay Riker before or after delivery of the vehicle? (b) Prepare the journal entry Riker would make to record receipt of Troy’s payment, assuming no interest revenue or interest expense had been recorded previously. (c) Prepare the journal entry Riker would make to record delivery of the vehicle, assuming no interest revenue or interest expense had been recorded previously.
On January 1, 2018, Byner Company purchased a used tractor. Byner paid $5,000 down and signed a noninterest-bearing note requiring $25,000 to be paid on December 31, 2020. The fair value of the tractor is not determinable. An interest rate of 10% properly reflects the time value of money for this type of loan agreement. Thecompany’s fiscal year-end is December 31.Required:1. Prepare the journal entry to record the acquisition of the tractor. Round computations to the nearest dollar.2. How much interest expense will the company include in its 2018 and 2019 income statements for this note?3. What is the amount of the liability the company will report in its 2018 and 2019 balance sheets forthis note?

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