Wilson purchased a large piece of land on the edge of St Albert in 1989 for $150,000. He sold it on March 1, 2020 to a developer for $550,000. He received a down payment of $250,000 at the time of sale. The remaining $300,000 is to be paid to him in equal annual instalments of $100,000 beginning March 1, 2021. Calculate Wilson's maximum capital gains reserve in 2020. Show work in the space below.
Q: Why is the profit maximization supposed not the most important goal of the company?
A: Solution Profit maximization is a process business firms undergo to ensure the best output and price...
Q: 7. True or False: At the end of the accounting period, the total of all job cost sheets related to u...
A: Work in Process inventory account balance includes cost of unfinished or incomplete jobs. The comple...
Q: Alfredo Company purchased a new 3-D printer for $900,000. Although this printer is expected tolast f...
A: 1. Depreciation Expenses - Depreciation Expenses are the expense incurred on the wear and tear of th...
Q: [The following information applies to the questions displayed below.] In 2010 Casey made a taxable g...
A: Amount of gift tax in 2010 = 345800 + (11400000-1000000) x 40%= 345800+4160000 = 4505800 unused exem...
Q: Yilmaz A.Ş. encounters the following situations: Identify the type of adjusting entry needed. Y...
A: Prepaid expense are expenses which are already paid ( in advance ) , the expenses are yet to be incu...
Q: Kaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments:...
A: GIVEN Kaumajet Factory produces two products: table lamps and desk lamps. It has two separate depa...
Q: ntiff was injured by medical malpractice and received a jury verdict of $500,000 ($200,000 for medic...
A: The collateral source rule refers to the rule which to decline in the sum of damages paid to the pla...
Q: Margin of Safety Yellow Sticker Company's variable expenses are 40% of sales. The company has monthl...
A: Lets understand the basics. Margin of safety is a all the sales over break even point. Formula (For ...
Q: Elyssa’s Elegant Eveningwear (EEE) needs to ship fi nishedgoods from its manufacturing facility to i...
A: Transit time is the amount of time needed for transporting of inventory from one place to another pl...
Q: Which ofr the following Items is not a management concept that was created to improve company perfor...
A: Solution: Managerial accounting is an accounting system that is used mainly for internal purposes. I...
Q: Use the following information for the Exercises below. [The following information applies to the que...
A: Perpetual inventory valuation is an inventory management method that records when stock is sold or r...
Q: Is the following statement TRUE or FALSE? Please provide reason for the answer. When Karen uses mon...
A: Money is a commodity which is generally accepted as a medium of exchange. It has various functions l...
Q: A table for a monthly bank reconciliation dated September 30 is given below. For each item 1 through...
A: Bank reconciliation refers to the method used by the company to match the bank statement as well as ...
Q: On January 1, 20X8, Ramon Corporation acquired 80 percent of Tester Company's voting common stock fo...
A: Depreciation: It implies to a decrease in fixed asset's value as a result of normal wear & tear,...
Q: SALES AND CASH RECEIPTS TRANSACTIONS Sourk Distributors is a retail business. The following sales, r...
A: Journal Book is prepared for recording all business day-to-day transactions. In Journal all transact...
Q: Four factors come together In production activity: beginning work In process Innventory, direct nate...
A: Answer 1) Beginning work in process inventory cost is carry forward from previous accounting period ...
Q: Problem 6. Use the following information for the next two questions: DISCALCED BAREFOOTED NAKASAKASA...
A: When an offer grants the option to acquire additional goods or services , such an option or offer is...
Q: Which of the following Is the correct formula for calculating days' sales in raw materials Inventory...
A: The ratio analysis helps to analyse the financial statements of the business.
Q: make a comparative analysis (between year 2019 and 2020) and find current ratio, acid test ratio and...
A: The current ratio refers to how many current assets are available to cover the current liabilities o...
Q: Break-Even with Multiple Products Wagner Enterprise sells two products, large tractors and small tra...
A: Sales mix refers to proportion of each unit of product in relation to the total sales. It is integra...
Q: If a person charges interest on a loan transaction equivalent to the inflation rate than will it be ...
A: Time value of the money is the value of the money which a person must use in order to know how much ...
Q: On the first day of the fiscal year, a company issues a $3,500,000, 6%, five-year bond that pays sem...
A: Introduction: Journals: Recording of a business transactions in a chronological order. Firs step in ...
Q: Equivalent units of production are equal to: Multiple Cholce The number of whole units that could ha...
A: The equivalent units are calculated on the basis of percentage of the work completed during the peri...
Q: Vhich of the following statements Is true with regard to activity-based costing? Multiple Cholce Act...
A: Solution: Under activity based costing, Cost are allocated to various cost pools and then their acti...
Q: Ms. Carla Babo, a self-employed individual, rents out a five-room apartment. One of the rooms is ren...
A: Answer: The room is rented to Mr Maco on March 1, which means that there was only 10months of the st...
Q: Pat Company reported the following information on December 31, 2020. Determine the legal capital: P2...
A: Legal Capital: When it comes to companies, legal capital is the amount of stock that is not legally ...
Q: The post-closing trial balance of Wildhorse Corporation at December 31, 2022, contains the following...
A:
Q: In many cases, banks do not permit depositors to spend the proceeds of a deposit until several days ...
A: Bank: A bank is a monetary organization where clients can set aside or acquire cash. Banks additiona...
Q: LMN Corp has the following data showing for the current year: Interest on peso savings account, net ...
A: Solution Concept The interest deduction allowable is 20% of the interest income that is chargeable t...
Q: 1. Compute (a) last year's CM ratio and the break-even point in balls, and (b) the degree of operati...
A: As per our protocol we provide solution to the one question or to the 3 sub-parts but as you have as...
Q: If the insurance plan where the insurance firm promises to make yearly payments of 200,000 pesos sta...
A: Annual payment = 200,000 pesos Interest rate = 6% Period from 11th year to 15th year = 5 Periods
Q: Determining Cost of Goods Sold For a recent year, Best Buy (BBY) reported sales of $39,528 million. ...
A: Gross Profit = Sales - Cost of Goods Sold
Q: Below is Huru's Company information for the preparation of proof of cash: Nov 30 ...
A: Cash and cash equivalents refer to cash or can be converted into cash immediately. It is reported un...
Q: Question 2 Alec Powell runs a small shop selling sports equipment. He has run this business as a sol...
A:
Q: A publishing company is planning on developing an SPSS Manual for graduate students in doctoral prog...
A: Formula: Break even point in units = Fixed cost / contribution margin
Q: Which of the following statement is not true?
A: Special journal is prime book of entry it would record and analyze specific transactions. making sp...
Q: Direct Write-Off Method Williams & Hendricks Distributors uses the direct write-off method in accoun...
A: Under direct write off method, the bad debt expense is not estimate and allowance is not created for...
Q: blêm 3 dmission by Investment of Assets
A: Goodwill is an intangible asset and is the reputation of...
Q: How would you journalize the closing entries for the month ended April 31, 2024? (*You credit retain...
A: Journal Entry: Keeping or creating records of any transactions, whether economic or non-economic, is...
Q: A cheque for $3,000 received from a debtor was deposited at the bank but no journal entry was made ...
A: The question is based on the concept of Financial Accounting.
Q: Direct Materials Variances The following data relate to the direct materials cost for the productio...
A: Direct material cost variance means variance between standard cost and actual cost of materials whic...
Q: Required: Record the budget amendments in the General Fund general journal only. Budgetary items do ...
A: General fund general journal is the recording of the budget entries in the journal book and adjustin...
Q: Instructions: Answer the following problems by determining the capital balance of each partner aft...
A: Partnership refers to the agreement or relationship between such people who have agreed to share the...
Q: 2. The cost of the machinery is $314,000, and the fair value of the asset on January 1, 2020, is $...
A: Lease refers to the form of contract by which one party leases its asset to another party in return ...
Q: You are an accountant working for a company that has recently decided to incorporate. The company ha...
A: Journal Entry For Cost incurred with respect to Incorporation Expenses Date Particulars Debit Amo...
Q: Shannon Company began operations on January 1, 2013. The financial statements contained the followin...
A: Error on working capital includes only the effect on current asset and current liabilities So, the ...
Q: Martinez Company's ending inventory includes the following items. Product Units Cost per Unit $ 58 M...
A: The lower cost and market value method considers the inventory value at 1. The Cost value 2.Market ...
Q: The following information has been obtained for Sheridan Corporation. 1. Prior to 2020, taxable inco...
A: Introduction:- Individuals or enterprises (taxpayers) pay an income tax depending on their earnings ...
Q: SALES AND CASH RECEIPTS TRANSACTIONS Paul Jackson owns a retail business. The following sales, retur...
A: Journal Entry The purpose of preparing the journal entry to enter the required transaction into debi...
Q: Exercise 5-12 Analysis of inventory errors LO A2 Vibrant Company had $1,090,000 of sales in each of ...
A: The income statement explains the financial performance of the company for a particular period of ti...
Step by step
Solved in 2 steps
- On June 30, 2019, Kelly sold property for 240,000 cash and a 960,000 note due on September 30, 2020. The note will also pay 6% interest, which is slightly higher than the Federal rate. Kellys cost of the property was 400,000. She is concerned that Congress may increase the tax rate that will apply when the note is collected. Kellys after-tax rate of return on investments is 6%. a. What can Kelly do to avoid the expected higher tax rate? b. Assuming that Kellys marginal combined Federal and state tax rate is 25% in 2019, how much would the tax rates need to increase to make the option identified in part (a) advisable?In 2021 an investor sold capital property for $80,000. The cost base of the property was $55,000. The investor agreed to the following payment schedule: $35,000 in 2021, $25,000 in 2022 and $20,000 in 2023. The investor elects to use the deferred proceeds method to report taxable income from this sale. How much would be the taxable capital gain reported by the investor in 2021? A. $20,000 B. $14,063 C. $10,938 D. $10,000 E. None of the aboveAn individual has an RSP that they are drawing money out of during 2020. TheRRSP has earned dividends of $10,000. The individual withdraws $32,000 from theRRSP. To obtain that much cash, the RSP sells investments worth $32,000 thathave a cost basis of $20,000. What is the individual's 2020 taxable income as aresult of the RRSP? A) 42000 B) 16000 C)19800 D)32000
- Tom sold a capital property on December 31, 2021 for $300,000. $280,000 is payable on December 31, 2023, and the balance was paid immediately in cash. The adjusted cost base of the property was $170,000 and the selling costs totaled $10,000. Which one of the following amounts represents the minimum taxable capital gain in 2021? $40,000. $70,000. $12,000 $24,000.Sara Nade had 2021 capital asset transactions as noted below. Determine the amount of her gain or loss for tax purposes. Sara owned a $10, 000 20 year U.S Treasury note that was due to mature in 2024. Needing some additional cash, she sold this debt instrument on October 31, 2021. With the dramatic decline in interest rates since this note's acquisition at par in 2004, Sara received 105 percent of the note's face value, along with accrued interest of $180.In 2020, Marshall sold a residential house and lot located in Cotabato forP10,000,000 to his friend. He acquired it at P5,000,000 back in 2016. The FMV atthe time of sale is P15,000,000 while the Zonal Value is P13,000,000. The tax onthe above transaction is A.P 900,000 Capital gains taxB.P 780,000 Capital gains taxC.P1,450,000 Basic Income TaxD.None of the above
- Aaron has a successful business with $50,000 of income in 2020. He purchased a new 7-year MACRS property with a cost of $7,000. For tax purposes, what cost recovery will provide the largest amount Aaron can deduct in 2020 for the new asset? (Please select the best option) a. Typical MACRS depreciation b. Bonus depreciation c. Section 179 immediate expensing d. Bonus and Section 179 will result in an equal amount e. MACRS, bonus, and Section 179 will all result in an equal amountAaron has a successful business with $50,000 of income in 2020. He purchased a new 7-year MACRS property with a cost of $7,000. For tax purposes, what cost recovery will provide the largest amount Aaron can deduct in 2020 for the new asset? a. Typical MACRS depreciation b. Bonus depreciation c. Section 179 immediate expensing d. Bonus and Section 179 will result in an equal amount e. MACRS, bonus, and Section 179 will all result in an equal amountMr. Chan decided to rent out one of his properties, and spent $200,000 to renovate the property in order to maximize the rental income. He finally rented the property for $50,000 per month for a three year term starting from 1 January 2019. How much can he claim for statutory deduction under property tax for the year of assessment 2020/21? Select one: a. $30,000 b. $120,000 c. None of above d. $200,000
- Jackson invested $192,000 in a passive activity five years ago. On January 1, 2018, his at-risk amount in the activity was $45,500. His share of the income and losses in the activity were $52,650 loss in 2018, $20,350 loss in 2019, and $80,750 gain in 2020. Required: How much can Jackson deduct in 2018 and 2019? What is his taxable income from the activity in 2020? Keep in mind the at-risk rules as well as the passive loss rules.In 2020, Skylar sold an apartment building for $20,000 cash and a $300,000 note due in two years. Skylar’s cost of the property was $250,000, and he had deducted depreciation of $150,000, $60,000 of which was in excess of what the straight-line amount would have been. Under the installment sales method, what is Skylar’s total realized gain? In 2020, how much § 1250 gain does Skylar recognize? How much § 1231 gain does he recognize?On June 15, 2020, Allen sold land held for investment to Stan for $68,000 and an installment note of $310,000 payable in five equal annual installments beginning on June 15, 2021, plus interest at 10%. Allen’s basis in the land is $196,560. What amount of gain is recognized in 2020 under the installment method?