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zaharov [31]
2 years ago
10

Nicholas bought land from Meredith for $150,000. Nicholas paid $50,000 cash and gave Meredith an 8% note for $100,000. The note

was to be paid over a five-year period. When the balance on the note was $80,000, Meredith began having financial difficulties. To accelerate her cash inflows, Meredith agreed to accept $60,000 cash from Nicholas in final payment of the note principal.
a. Nicholas must recognize $20,000 ($80,000 - $60,000) of gross income.
b. Meredith must recognize gross income of $20,000 ($80,000 - $60,000) from discharge of the debt.
c. Nicholas is not required to recognize gross income, but must reduce his cost basis in the land to $130,000.
d. Nicholas is not required to recognize gross income, since he paid the debt before it was due.
e. None of these choices are correct.
Business
1 answer:
Tom [10]2 years ago
3 0

Answer:

C. Nicholas is not required to recognize gross income, but must reduce his cost basis in the land to $130,000

Explanation:

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Vitek1552 [10]

When using horizontal differentiation, a firm divides itself into sub units based on function, type of business, or Geographic area

Horizontal Differentiation :

Horizontal differentiation refers to distinctions in products that cannot be easily evaluated in terms of quality. This stands in contrast to vertical differentiation, where the distinctions between products are objectively measurable and are based in the products' respective level of quality. Horizontally differentiated products vary only marginally, as it's more efficient for producers to try to capture as many new consumers as possible with minimal additional costs. While horizontally differentiated products tend to command similar prices at equilibrium, the lack of relationship to quality does not necessarily imply that they cost the same -- two products may be virtually identical in all considerations except for color or flavor and still be offered at totally different prices.

What is meant by geographical area?

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You have been placed in charge of a large project. Shortened communication lines are required to ensure quick resolution of prob
EastWind [94]
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3 years ago
Jill earns a salary of $425.00 per week, plus a commission of 20% on all sales. Last week she sold $1,123 worth of goods. How mu
ch4aika [34]
To find 20% of the value of the goods,
1,123 x 20% (this is the same as 1,123 x 0.2)
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4 0
2 years ago
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Are cities around the world doing a disservice to their citizens or their visitors, or both, by banning uber outright from opera
Ne4ueva [31]

Answer:

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4 0
3 years ago
On October 1, Courtland Company sold merchandise in the amount of $5,800 to Carter Company, with credit terms of 2/10, n/30. The
Vilka [71]

Answer:

The journal entry that Courtland makes on October 8 is:

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Debit Sales Discount $116

Credit Receivable Accounts $5,800

Explanation:

On October 1, when Courtland Company sold merchandise, the following entries were made:

1. Debit Cost of goods sold $4,000

Credit Merchandise $4,000

2. Debit Receivable Accounts $5,800

Credit Sales $5,800

Credit terms of 2/10, n/30 means that 2% discount for the payment within 10 days and the full amount to be paid within 30 days.

Carter pays and takes the appropriate discount:

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The journal entry that Courtland makes on October 8 is:

Debit Cash $5,684

Debit Sales Discount $116

Credit Receivable Accounts $5,800

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