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Nataliya [291]
2 years ago
12

If a company exchanges an asset with a book value of $260,000, an original cost of $500,000, and a fair value of $300,000 plus c

ash of $100,000 for a new asset, what is the gain or loss recognized on the transaction?.
Business
1 answer:
Harlamova29_29 [7]2 years ago
8 0

The gain that would be recognised on the exchange of the asset by the company is $140,000.

<h3>What is the gain on the asset?</h3>

The gain on the exchange of an asset is recorded when the fair value is greater than the book value of the asset. The gain on the exchange is sum of the difference between the fair value and the book value and the cash.

Gain = (fair value - book value) + cash

($300,000 - $260,000) + 100,000 = $40,000

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Jed Castanza transfers $90,000 of cash to the JN partnership for a 60 percent interest in the JN partnership. Ned transfers a bu
mojhsa [17]

Answer:

Their basis will be 90,000 for Mr Castanza

and 60,000 for Ned

Also Ned will recognize a capital gain for 70,000 when performing the transfer of the property. As his adjusted basis is 30,000 while the property value is 100,000

Explanation:

Mr Castanza

90,000 = 60%

Ned

100,000 - 40,000 = 60,000 = 40%

Total capital

90,000 + 60,000 = 150,000 = 100%

<u>Check for difference:</u>

90,000/150,000 x 60% = 90,000

60,000/150,000 x 40% = 60,000

Their basis will be 90,000 for Mr Castanza

and 60,000 for Ned

Also Ned will recognize a capital gain for 70,000 when performing the transfer of the property. As his adjustedbasis is 30,000 while the property value is 100,000

8 0
3 years ago
Ground-fault circuit interrupters must be used for all of the following except?
gtnhenbr [62]

Ground-fault circuit interrupters must be used for all of the following except?

A-rooftop

<u>B-any outdoor area </u>

C- where temporary wire is being used

7 0
3 years ago
Suppose the United States can produce either 90 apples and 20 oranges or 80 apples and 30 oranges. What is the opportunity cost
Tju [1.3M]

Answer: The opportunity cost of producing 1 apple will be 1 orange.

Explanation:

Opportunity cost is defined as the loss or cost of another alternative when another alternative is being chosen by an economic agent.

In this scenario, the opportunity cost of producing every additional apple will be 1 orange due to the fact that as there's an increase in the production of apple from 80 to 90, there'll be a reduction in the production of orange from 30 to 20.

This indicates that for the increase of 10 apples, there's a reduction of 10 oranges which implies that an increase of 1 apple brings about a reduction by 1 orange.

5 0
3 years ago
Faye files a suit in a state court against Gas Station Stop, claiming employment discrimination. Gas Station loses the suit and
densk [106]

Answer:

a.

Explanation:

Based on the information it can be said that in this scenario either party can appeal the decision to the United States Supreme Court if a federal question is involved. This means that there is an issue within the case that involves the constitution or other federal laws. These types of issues are cause for being able to take the case to the Supreme court.

7 0
3 years ago
ABC Corporation distributes property to its sole shareholder, Andre. The property has a fair market value of $350,000, an adjust
saul85 [17]

Answer:

ABC has a gain of $145,000 and Andre's dividend income is $130,000

Explanation:

Property ABC issued, has the following:

fair market value = $350,000

Adjusted basis = $205,000

Liability = $220,000

Calculate ABC's Corporation gain:

Gain = market value - Adjusted basis

= $350,000 - $205,000

= $145,000

ABC has a gain of $145,000

Calculate Andre's dividend income since he is the sole shareholder:

Dividend earnings = fair market value - liability

= $350,000 - $220,000

= $130,000

Andre's dividend income is $130,000

Correct option is D.

With respect to distribution, ABC has a gain of $145,000 and Andre's dividend income is $130,000

8 0
3 years ago
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