Answer:
Explanation:
Because land never depreciates, Western Bank & Trust wanted to distribute a higher percentage of the purchase price to the building, rather than the land. By allocating 90% of the purchase price to the building, rather than a more accurate 70%, Western Bank & Trust increases the depreciation amount of the building each year. For tax purposes, the IRS requires that the Modified Accelerated Cost Recovery System (MACRS) be used as the depreciation method used by companies. Under this method, the IRS specifies the useful life for a specific asset. MACRS also ignores residual value of an asset at the end of its useful life. By stating that the building was worth 90% of the total purchase price, Western Bank is attempting to increase its tax deduction from the IRS, because only the building depreciates, not the land. This improper allocation of the total purchase amount violates GAAP principles, which require that accounting information be “relevant and have faithful representation.” The information must be “complete, neutral, and free from error” (Nobles, Mattison, & Matsumura, 2014). For Western Bank to provide complete, neutral, and free from error information, it should record the transaction honestly: 70% to the building, 30% to the land. This dishonest representation is harmful to the federal government in that it is allowing Western Bank to take more money than what it is owed. If these kinds of situations happen on a large scale, it could have a huge impact on the economy in general. Source: Nobles, T., Mattison, B., & Matsumura, E. M. (2014). Horngren's Accounting, 10th Edition. Pearson Education, Inc. Student 2
Fannie mae says lenders need to use appraisers who have knowledge, experience, and data sources for appraising manufactured homes.
The term appraiser refers to that professional person who determines the market value of an asset generally in the real estate industry.
An appraiser should always act independently of the buying and selling parties in a transaction. The opinion given by them about the real and fair value of an appraised asset must be unbiased in nature. It must be valued by using observations as well as relevant statistics or facts, and the other information.
Depending upon the circumstances, the appraisers always presents their findings in a written as well as verbal appraisal.
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Whenever min. goes up, taxes increase, prices on food, goods../ are higher price, and especially gas...
Answer:
Commodity crops.
Explanation:
Commodity crops are crops that are grown for the purpose of sale. They have a lot of uses as they cannot easily spoil and easy to store for a long period of time. They provide a source of food for man around the world and also serve some industrial purposes. Examples are cotton, wheat, corn, barley, meat, diary, etc.
They can reduce production of less commonly grown fruits and vegetables.
Answer:
penalty clause
Explanation:
A penalty clause is a provision included in the contract that requires any breaching party to compensate the other party for any damages produced by the breaching of the contract.
In this case, the penalty provision establishes a $10 million payment if any of the parties breaches the contract. That payment must be done to compensate for any damages suffered by the non-breaching party.
