Financial Accounting
15th Edition
ISBN: 9781337272124
Author: Carl Warren, James M. Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 1, Problem 6DQ
(a)
To determine
Explain whether the amount at which the land is recorded should be changed according to the appraised value of land.
(b)
To determine
Indicate the effect of sale of land for $2,125,000, on the
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if a company is considering the purchase of a parcel of land that was acquired by the seller for $89,000 is offered for sale at 158,000 is assessed for tax purposes at 99,000 is considered by the purchaser as easily being worth 148,000 and is purchased for 145,000 the land should be recored in the purchaser books at (A. 99,000, B. 145,000, C. 146,500, D. 148,000, E. 158,000)
H6.
A business sells real property for $950,000, with $600,000 of this amount being allocated to the building and the remaining $350,000 allocated to the land. The building, the only asset in its Class, had a capital cost of $800,000 and a UCC of $650,000. The adjusted cost base of the land was $250,000. What are the tax consequences of this disposition? A capital gain of $50,000 and a terminal loss of $50,000 © A capital gain of $100,000 and a capital loss of $50,000 C A capital gain of $50,000 and a terminal loss of nil © A capital gain of $100,000 and a terminal loss of $50,000 Please give accurate response
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Russell Corporation sold a parcel of land valued at $400,000. Its basis in the land was $275,000. For the land, Russell received $50,000 in cash in yar 0 and a note providing that Russell will receive $175,000 in year 1 and $175,000 in yar 2 from the buyer.
What is Russell’s realized gain on the transaction?
What is Russell’s realized gain in year 0, year 1, and year 2?
Chapter 1 Solutions
Financial Accounting
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