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omeli [17]
3 years ago
14

Lincoln has used a piece of land in her business for the past five years. The land qualifies as §1231 property. It is unclear wh

ether Lincoln will have to recognize a gain or loss when she eventually sells the asset. She asks her accountant how the gain or loss would be characterized if she decides to sell. Her accountant says that selling §1231 assets gives sellers ""the best of both worlds."" Explain what her accountant means by this.
Business
1 answer:
Mashcka [7]3 years ago
5 0

Answer:

Explanation Below.

Explanation:

By Selling the property, the company gains cash from the sale, and also has been using the land for the business.

Land does not depreciate in accounting terms, however, it will depend on the market value of the land. In most cases the land will appreciate and have a greater value each year.

When the accountant states that selling the asset gives the seller "the best of both worlds" the accountant is referring to selling the land for a greater value than purchased and now the cash can be used to purchase another asset that will also bring value to the company.

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What is a market economy regulated by?
miskamm [114]

Answer:

Producers and consumers :)

Explanation:

Market economies are run by buyers and sellers, there is no government involved.

6 0
3 years ago
Stimpleton Company engages in the following cash payments:
choli [55]

Answer: Option A

Explanation: Operating activities refers to those activities which are directly related to the core operations of the business. Such transactions are important for running the business and recorded at the top in cash flow statements.

Thus, only payment of rent and workers salary will be considered operating activities and the company will be having total of $1750 of cash outflow.

Hence the correct option is A.

4 0
3 years ago
The direct write off is used when:
Thepotemich [5.8K]

Answer:

The correct answer is letter "A": Uncollectible accounts are not anticipated or immaterial.

Explanation:

Direct write-off is a method used to record debts from credit sales. An allowance account is not used with this method but an account receivable directly written-off for the outstanding amount once it is determined to be uncollectible. This method is used for tax-reporting purposes.

3 0
3 years ago
On February 2, Flint Corp.'s board of directors voted to discontinue operations of its frozen food division and to sell the divi
ikadub [295]

Answer: $40,000

Explanation:

The gain from discounted operations assuming no income taxes, is the gain from the sale of the asset less the net operating losses in the period.

= Gain from Sales of Asset - Net losses in period

= 90,000 - ( 20,000 + 30,000)

= $40,000

8 0
3 years ago
The cost C and the revenue R for a brokerage firm depend on the number T of transactions executed. (Both C and R are measured in
marusya05 [52]

Answer:

C(T) = $730 + $25T

R(T) = $35T

T = 193 transactions

Explanation:

Given that:

C = cost ; R = revenue ; T = number of transactions

Amount paid per transaction = $25

Cost keeping office open = $730

Amount collected on each transaction = $35

(a) Find a formula that gives C as a function of T.

C(T) = Cost of keeping office open + (cost per transaction × number of transactions)

C(T) = $730 + $25T

(b) Find a formula that gives R as a function of T.

R(T) = (Amount collected per transaction * number of transactions)

R(T) = $35T

(c) Find the number of daily transactions that are needed to make the revenue $1200 more than the cost.

R = C + 1200

Substitute the value of R and C into the equation:

35T = 730 + 25T + 1200

35T - 25T = 730 + 1200

10T = 1930

T = 1930 / 10

T = 193 transactions

6 0
3 years ago
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