Q. On August 10, 2017, Sophia purchased and placed into service a commercial building (39 years SL) for $3.000,000 (building $2,250,000 and land $750,000). On January 1, 2022, the commercial building was contributed to the newly formed partnership S&L Commercial Properties Ltd. At the time of the contribution the building and land were valued at $4,500,000 (building $3,500,000 and land $1,000,000). The initial tax annual tax depreciation equals $57,692 = $2,250,000/39 years. As of December 31, 2021, the adjusted tax basis of the building was $1,997,597. There are 415.5 months remaining the the class life for this commercial building. Calculate the annual book depreciation using the traditional method found in Regulation §1.704- 3(b) for 2022. Pick a answer. 1. $101,083 2. $89,744 3. $86,004 4. $57,692

Q. On August 10, 2017, Sophia purchased and placed into service a commercial building (39 years SL) for $3.000,000 (building $2,250,000 and land $750,000). On January 1, 2022, the commercial building was contributed to the newly formed partnership S&L Commercial Properties Ltd. At the time of the contribution the building and land were valued at $4,500,000 (building $3,500,000 and land $1,000,000). The initial tax annual tax depreciation equals $57,692 = $2,250,000/39 years. As of December 31, 2021, the adjusted tax basis of the building was $1,997,597. There are 415.5 months remaining the the class life for this commercial building. Calculate the annual book depreciation using the traditional method found in Regulation §1.704- 3(b) for 2022. Pick a answer. 1. $101,083 2. $89,744 3. $86,004 4. $57,692

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion

Section: Chapter Questions

Problem 43P

See similar textbooks

Similar questions

Ted Khan owns Khan Development Inc. During 20X7, the following transactions took place: Transaction A Transaction B Transaction C Khan acquired a parcel of land for $11,400,000 (plus 2% in real estate commissions). On closing, Khan paid $45,400 in legal fees as well as $23,300 in back taxes owed on the property. The land would be used to build new semi-detached and row townhouses. Immediately following the purchase, Khan submitted a proposal to the municipality to rezone the property to residential use. Legal fees and other admin costs associated with the rezoning permits were $59,000. Upon approval, Khan completed grading and added new drainage that was required as part of the approval. The total cost of this work was $173,000. Khan also acquired another nearby parcel of land, already zoned as residential for $1,680,000. The land had two houses that were inhabitable in their current state. Khan planned to use this site to build their sales office and showrooms for the sites above. The…
7. Mr. Y acquired his business' building with a 10-year useful life on October 1, 2010. As of December 31, 2018, the carrying value of the buiding is P1,040,000. The building can be sold at the estimated value of P200,000 at the end of its useful life. Based on the given data, what is the cost of the Building acquired by Mr. Y? *
Investment Property Determine the cost of the following items of investment acquired by Sasha Corporation during 2022; Land site for capital appreciation was acquired for P8,600,000. The company paid P430,000 commission to a real estate agent. Costs of P 135,000 were incurred to clear the land. During the course of clearing the land, timber and gravel were recovered and sold for P 65,000. The cost of investment property is _____________ Land and building were acquired to be held for under operating leases. The company made a de payment of P4,000,000, issued 20,000 P200 par ordinary shares with a market price of P240 per share, and issued a three-year non-interest-bearing note for P6,000.000 note is payable in equal annual installments of P2,000,000 at the end of each year from the date of purchase. The prevailing interest rate for similar notes is 10%. 30% of the purchase price is allocated to the land. Investment property is recorded at __________
Yellow Corporation, a C corporation, purchases a building on July 1, 2008, for $1,000,000. Straight- line depreciation is taken in the amount of $425,000 before the property is sold on May 12, 2023, for $1,200,000. What is the amount and character of the gain recognized by Yellow on the sale of the realty? Ordinary income of $115,000 and § 1231 gain of $510,000. Ordinary income of $0 and § 1231 gain of $625,000. Ordinary income of $85,000 and § 1231 gain of $540,000. Ordinary income of $425,000 and § 1231 gain of $200,000.
If Ivanhoe paid $20,000 to a real estate broker on January 1, 2025, as a fee for finding the lessor, what is the initial measuremen of the right-of-use asset? (Round answers to O decimal places, e.g. 5,275.) Right-of-use asset $ 94178
On October 7, 2020, Grace Gems purchased a basket of assets for the lump-sum price of $150,000. The fair market values of the assets Grace purchased were as follows: U.S. government securities $10,000 Land 36,000 Building 90,000 Equipment 15,000 Furniture 9,000 What is Grace's basis in the building? $84,375 $90,000 $105,000 $114,000
A. ACQUISITION COSTS Mr. Ardi acquired land at a cost of Rp4.200.000.000 on April 1, 2019. In addition to this cost, he had to pay the following expenses: a. Commission fee, 2% from the land price, Rp84,000,000 b. Land acquisition tax Rp12,000,000 c. Removal cost of old (unused) building Rp20.500.000. Mr. Ardi received Rp17.000.000 from the sales of salvage materials. d. Rpl10.000.000 to build a fence e. Rp215.000.000 to build a parking lot Instructions: Prepare the journal entries for the above transaction! (4%)
Turtle Corporation is a calendar year C Corporation formed in 2017. Turtle purchased a motel property in June 2020 for $11,000,000. The motel land value represented $2,500,000 of the $11,000,000 purchase price. What is the allowable depreciation deductions on the hotel for 2020 and 2021? A. $118,235 in 2020 and $217,940 in 2021 B. $153,010 in 2020 and $282,040 in 2021 C. $167,450 in 2020 and $309.060 in 2021 D. $309,060 in 2020 and $167,450 in 2021
Determine the cost of the following items of investment acquired by Sasha Corporation during 2022;a. Land site for capital appreciation was acquired for P8,600,000. The company paid P 430,000 commission to a real estate agent. Costs of P 135,000 were incurred to clear the land. During the course of clearing the land, timber and gravel were recovered and sold for P 65,000. The cost of investment property is _____________b. Land and building were acquired to be held for under operating leases. The company made a de payment of P4,000,000, issued 20,000 P200 par ordinary shares with market price of P240 per share and issued three year non-interest bearing note for P6,000.000 note is payable in equal annual instalments of P2,000,000 at the end of each year from the date of purchase. Prevailing interest rate for similar notes is 10%. 30% of the purchase price is allocated to the land. Investment property is recorded at __________
Jessie Company purchased an investment property on January 1, 2020 at a cost of P2,200,000. The property had a useful life of 40 years and on December 31, 2022 it had a fair value of P3,000,000. On December 31, 2022, the property was sold for net proceeds of P2,900,000. The entity used the cost model to account for investment property. What is the gain or loss to be recognized in 2022 regarding the disposal of the property? A. 865,000 gain B. 810,000 gain C. 100,000 loss D. 700,000 gain
On April 13, 2023, Swifty Ltd. purchased a small apartment building with eight suites. The building qualified as an investment property under IAS 40. At the time of purchase, six out of the eight suites were rented. Swifty paid the following items at the time of its acquisition of the apartment building (all items were paid in cash except for the building itself, for which Swifty took out a mortgage): Purchase price of building $4,050,000 Legal fees 7,720 Property transfer fees 24,500 Painting of empty apartments 5,390 Advertising for empty apartments 2,000 On April 14 the previous owner of the apartment building paid Swifty $13,000 for damage deposits from the existing tenants. On December 31, 2023, the apartment building had a fair value of $4,250,000. On December 31, 2024, it was determined that the apartment building had a fair value of $4,040,000. Assuming Swifty follows IFRS, prepare the journal entries required to record the above events. (Credit account titles are automatically…
Group Activity 2. On January 1, 2021, Entity A received land with fair of $200,000 from the government conditioned on the construction of a building on the lot. Entity A started immediately the construction and it was completed on December 31, 2021 for a total cost of $1,000,000. The building has an estimated useful life of 10 years and zero residual value. a. How much is the income from government grant in 2021 and 2022, respectively? b. How much is the carrying amount of the building on December 31, 2022 under the gross presentation and net presentation? c. How much is the depreciation expense recognized in 2023 under the gross presentation and net presentation?