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xxTIMURxx [149]
3 years ago
13

Troy (single) purchased a home in Hopkinton, MA, on January 1,2007, for $300,000. He sold the home on January 1, 2016, for$320,0

00. How much gain must Troy recognize on his home sale ineach of the following alternative situations? d. Troy rented thehome from January 1, 2007, through December 31, 2011. He lived inthe home as his principal residence from January 1, 2012, throughDecember 31, 2012. He rented out the home from January 1, 2013,through December 31, 2013, and lived in the home as his principalresidence from January 1, 2014, through the date of the sale.Assume accumulated depreciation on the home at the time of sale was$0. Gain recognized? The answer is not $28,571 The answer is not$4,375
Business
1 answer:
Artemon [7]3 years ago
5 0

Answer:

$20,000

Explanation:

Time difference from the "Purchase date" to "Sale date" = 9 years (1/1/2007 to 1/1/2016)

Given that, in the 9 years, Troy rented the home for first 5 years (1/1/2007 to 1/1/2012), and lived in the home as his principal residence for next 1 year(1/1/2012 to 31/12/2012)

and again rented out the home for 1 year (1/1/2013 to 31/12/2013), and again started to lived in the home as his principal residence for next 2 years. (1/1/2014 to 1/1/2016)

i.e. when we look at the last 5 years before the sale of house, Troy has lived 3 years in the home as his principal residence.

And Troy has acquired the home for $300,000 and not acquired by "like kind exchange" of property.

As per IRS rules, a owner must live at least 2 years in the home as his principal residence & home must not be acquired by 1031 exchange (like/kind exchange).

Here, Troy satisfies both conditions. (He has lived more than 2 years, and not acquired by like/kind exchange)

So, as per above rules, Troy's home sale is eligible for Maximum exclusion of $250,000 gain (being Troy is Single)

Here, as per IRS rules, Gain = Amount Realized / Adjusted Basis = $320,000 - $300,000 = $20,000.

But, being Troy home sale is eligible for Maximum exclusion of $250,000, this $20,000 gain is deducted and Net Gain = $0.

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Which of the following pair of journal entries correctly records the current month's activity where the company had $21,030 in t
Lelechka [254]

Answer:

----------------------    -   -------------------------------

Factory Payroll         21030

             Cash                        21030

----------------------    -    -------------------------------

Goods in process     16200

Factory Overhead     4830

       Factory Payroll               21030

----------------------    -    -------------------------------

Explanation: The payment of the total labor factory costs must be recorded, we debit the "Factory payroll" cost account and credit the "cash" account as they were paid in cash.

Then we must allocate these costs to the production process, therefore we debit the "goods in process" account for the amount of <u>direct labor</u> consumed, and "factory overhead" for the amount of <u>indirect labor </u>consumed, and finally credit the account " Factory payroll " for the total.

7 0
3 years ago
When Anastasia sells her Tesla common stock at the same time that Roman purchases the same amount of Tesla stock, Tesla receives
Ivenika [448]

Answer: Nothing

Explanation:

When Anastasia sells her Tesla common stock at the same time that Roman buys the same amount of Tesla stock, then Tesla will receive nothing.

Forur example, let's assume that Anastasia sells her Tesla common stock which was worth $2000 and Roman buys the same amount of Tesla stock, which was $2000. Then Tesla will get: $2000 - $2000 = 0. Therefore, the answer is nothing.

7 0
3 years ago
All of the following factors should be assessed to determine an organization’s ability to perform projects EXCEPT: ​ a. Do we mo
wolverine [178]

Answer:

C.

Explanation:

Do teams and individuals follow instructions well?

All the projects in an organization are based in team work, and need to be thinking as a team that reacts to a external environment.  So, this exclude answers A, B and D.

4 0
3 years ago
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1. Give a brief description of the Business and Industry Endorsement.
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Answer:

siness and Industry Endorsement.

;,;l,

Explanation:

3 0
3 years ago
Firms U and L each have the same amount of assets, investor-supplied capital, and both have a return on investors' capital (ROIC
Tanya [424]

Answer:

The correct option is a.

Explanation:

In the question, it is given that there are two firms namely U and L who has same same amounts of assets, investor supplied material, and Return on investor capital.

The Firm U is unleveraged which has 100% equity

whereas,  Firm L is leveraged firm which has 50% debt and 50% equity

As we have to compare these two firms based on return on equity.

So, based on ROE, Firm U has 100% equity so it have more equity

And, the Firm L have 50% equity which means the firm has low equity as 50% contribution is gone to the debt.

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Thus, the Firm L has a lower ROE than Firm U

Hence, the correct option is a.

4 0
3 years ago
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