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enot [183]
3 years ago
5

Sandra's automobile, which is used exclusively in her trade or business, was damaged in an accident. The adjusted basis prior to

the accident was $11,000. The fair market value before the accident was $10,000 and the fair market value after the accident is $6,000. Insurance proceeds of $3,200 are received. What is Sandra's adjusted basis for the automobile after the casualty?
Business
1 answer:
strojnjashka [21]3 years ago
5 0

Answer:

The Sandra's adjusted basis for the automobile after the casualty will be $7000.

Explanation:

Sandra's adjusted basis after accident can be taken out using the following procedure -

  ADJUSTED BASIS BEFORE ACCIDENT

                         -

 LOSS DEDUCTION

                         -

 INSURANCE PROCEEDS

we have been given the value of adjusted basis before accident = $11,000 and insurance proceeds as = $3200, but we have to find the value of loss deduction.

LOSS DEDUCTION =

VALUE DECLINE - INSURANCE PROCEEDS

Where value decline is the difference between the market value of automobile before and after accident and insurance proceeds - ($10,000 - $6000) - $3200

     VALUE DECLINE - $4000 - $3200

                                 = $800

Now putting all the values in the procedure -

= $11,000 - $800 - $3200

= $7000

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Answer:

1 False

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Explanation:

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Adriana and Belen are partners who share income in the ratio of 3:2 and have capital balances of $50,000 and $90,000 at the time
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Explanation:

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To find the amount of cash distributed to Adriana we multiply by her ratio:

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