When calculating the long term capital gain on the sale of the property, it is important to make sure adjustments are made from the original date of purchase and when the land was gifted.
To solve:
Adjusted amount = Original purchase amount + (gift tax X difference in what the land was worth/original land worth amount)
Adjusted amount = $20,000 + ($40,000 X $80,000/$100,000)
Adjusted amount = $52,000
Land owned for $200,000
Adjust amount is $52,000
$200,000 - $52,000 = $148,000
The long-term capital gain on the property is $148,000.
Answer: This answer is A. total quality management.
Explanation:
A. total quality management - This is a term used to describe a situation where all business functions are involved in a process of continuous quality improvement. It is also the continuous process of detecting and reducing errors to the barest minimum. All parties involved are held accountable for the overall quality of the final product or service. Four costs are associated with TQM, which are prevention costs, appraisal costs, internal failure costs and external failure costs.
B. Activity-based costing aims to provide management with a simplified method of introducing and managing "process and organization change". It can also be seen to include activity analysis, cost driver analysis, continuous improvement, operational control and performance evaluation.
C. Balanced scorecard is a strategic performance tool that is used by managers to track the performance of their subordinates.
D. Value chain connotes all business processes that are involved in providing a product or service.
Answer:
Explanation:
FASB amended the rules to improve the comparability of the information about business combinations provided in financial reports. A variable interest entity is a legal business.
The Financial Accounting Standards Board issued SFAS 141(R) in 2007 December, to substitute the SFAS 141. Evaluating the comment letters, articles and industry publications, they analyzed issues that were with SFAS 141 from the perspective of professionals, users and the FASB; it was evaluated 141(R) to ascertain these weaknesses and they were corrected with solutions been profound in 141(R).
Answer:
D) $150,000
Explanation:
Insurance proceeds that are not reinvested in replacing damaged property are taxed. Apparently Prime corporation didn't reinvest into replacing the property, so this transaction should be taxed as a property sale. Prime received $400,000 for the building with a $350,000 basis which results in a net gain = $50,000.
The other $100,000 were given as replacement income and therefore should be taxed as such.
So the total taxable amount = $50,000 + $100,000 = $150,000
