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ioda
3 years ago
11

Sue and Andrew form SA general partnership. Each person receives an equal interest in the newly created partnership. Sue contrib

utes $18,000 of cash and land with an FMV of $63,000. Her basis in the land is $28,000. Andrew contributes equipment with an FMV of $20,000 and a building with an FMV of $41,000. His basis in the equipment is $16,000, and his basis in the building is $28,000. How much gain must the SA general partnership recognize on the transfer of these assets from Sue and Andrew
Business
1 answer:
zloy xaker [14]3 years ago
7 0

Answer:

$0

Explanation:

Given that

Sue contributed amount = $18,000

FMV of land = $63,000

Basis in land = $28,000

Andrew contributed amount = $20,000

FMV of Building = $41,000

Basis in equipment = $16,000

Basis in building = $28,000

Based on the above information, the gain that would be recognized is $0 as Partnerships recognize no gain on receiving contributed valued property. At the disposal of the asset, the constructed-in benefit or constructed-in loss will be revealed. For this, the partnership basis property i.e being acquired should be based on a carryover basis.

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Answer:

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b-2. Cost of goods sold = $8,650

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Explanation:

a) Data and Calculations:

Beginning inventory    300 units  at $10 per unit = $3,000

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October purchases     400 units at $12 per unit =    4,800

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Ending inventory        550 units

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a. The number of units purchased in October = 400 (1,300 - 300 - 600)

The cost per unit = $12 ($4,800/400)

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Cost of goods sold:

300 units  at $10 per unit = $3,000

450 units at $11 per unit =     4,950  $7,950

Ending inventory = $6,450 ($14,400 - $7,950)

b-2. Cost of goods sold and ending inventory using LIFO method:

Cost of goods sold:

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400 units at $12 per unit =    4,800

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Answer:

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Explanation:

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Cash Budget for March

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Les Budgeted Expenses                          ($110,000)

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Balance                                                        $41,000

Loan ($51,500 - $41,000)                            $10,500

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