Thato Smit owns rental properties originally valued at $275,000. (Property 1: land $70,000, building $55,000) (Property 2: land $90,000, building $60,000) The buildings are Class 1 (4%) properties. Net rental income before CCA in 2020 was $11,000. · The UCC on building 1 at the beginning of 2020 was $50,000. · The UCC'on building 2 at the beginning of 2020 was $40,000. Property 2 was sold in 2020 for $250,000 (land $200,000, building $50,000) Thato incurred costs during the year for repairs ($1,100), taxes ($2,500) and utilities ($3,500). Calculate Thato's net rental income income for tax purposes. Thato llowed this vear on the rental

Thato Smit owns rental properties originally valued at $275,000. (Property 1: land $70,000, building $55,000) (Property 2: land $90,000, building $60,000) The buildings are Class 1 (4%) properties. Net rental income before CCA in 2020 was $11,000. · The UCC on building 1 at the beginning of 2020 was $50,000. · The UCC'on building 2 at the beginning of 2020 was $40,000. Property 2 was sold in 2020 for $250,000 (land $200,000, building $50,000) Thato incurred costs during the year for repairs ($1,100), taxes ($2,500) and utilities ($3,500). Calculate Thato's net rental income income for tax purposes. Thato llowed this vear on the rental

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please calculate the rental income for tax purposes. In July 2022, an individual acquires a rental property for $ 20,000. $110,000 is allocated to the land and $160,000 is allocated to the building. The property is rented for $ 1,800 per month. Condo fees are $50 per month, property taxes are $1,000 per year and interest expense for 2022 is $6,100. Note: the building was acquired after 1987 for residential use; therefore, a class 1 asset (CCA rate = 4%)
1. On December 31,2020 the account for Shane Oil Company's individually insignificant unproved properties had a balance of $600,000. The impairment allowance account had a balance of $100,000. Required Give the entries for each of the following transactions occurring in 2020 and 2021 (all transactions concern individually Insignificant unproved leases) a.Assuming Shane has a policy of maintaining a 60% allowance, i.e. 60% of gross unproved properties, give the entry to record impairment on December 31, 2020 b.During 2021 Shane surrendered leases that cost $200,000. c.During 2021,leases that cost $40,000 were proved d.Give the entry to record impairment on December 31, 2021.
Please include all the calculations for my reference. Thanks!
Q5.
AP 5-2 (CCA Calculations) On January 1, 2022, Carlson Manufacturing had the following UCC balances: Class 53 Class 50 Class 10 Class 10.1 Class 13 Class 8 Class 3 2. 3. $462,000 82,000 142,000 16,500 102,000 96,000 326,000 Other information related to the company's depreciable property is as follows: 1. In 2022, the company purchased additional manufacturing and processing equipment at a cost of $106,000. In 2022, there were additions to class 50 with a capital cost of $15,600. In 2022, three vehicles were acquired at a cost of $22,000 each. In addition, a delivery van with a capital cost of $43,000 was sold for $21,000. None of the vehicles are zero- emission.
The undepreciated capital cost balances at January 1, 2023 were as follows: - Class 13 $37,500 Improvements on its leased head office premises which were rented in 2021 for four years with two successive options to renew for five years and five years. Improvements had originally been made in 2021 in the amount of $45, 000. Additional improvements were made in 2023 at a cost of $28,000. 2021: 45000 / (4+5) : = 5000 2023: 28000 / (2+5) = 4000 x 1.5 = 6000 You multiply by x 1.5 in 2023 because it is a net addition. What does that mean? Explain clearly.
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9) Tom Tom LLC purchased a rental house and land during the current year for $150,000. The purchase price was allocated as follows: $100,000 to the building and $50,000 to the land. The property was placed in service on May 22. Calculate Tom Tom's maximum depreciation for this first year. (Use MACRS Table 3.) A) $1,605 B) $2,273 C) $2,408 D) $3,410 E) None of the choices are correct.
50.On August 30, 2020, AAA Company purchased a tract of land for P12,000,000. AAA incurred additional cost of P3,000,000 during the remainder of 2020 in preparing the land for sale. The tract was subdivided into residential lots as follows: Lot class Number of lots Sales price per lot A 100 240,000 B 100 160,000 C 200 100,000 Using the relative sales value method, what amount of cost should be allocated to Class C lots?
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N1.
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