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hoa [83]
3 years ago
13

Mike and Karen were divorced. Their only marital property was a personal residence with a fair market value of $1.5 million and

a cost of $575,000. Under the terms of the divorce agreement, Mike would receive the house and Mike would pay Karen $150,000 each year for 5 years, or until Karen's death, whichever should occur first. Mike and Karen were not living together when the payments were made by Mike. Mike paid the $750,000 to Karen over the five-year period. Mike's recognized gain from the transfer of the house to him is:
Business
1 answer:
Soloha48 [4]3 years ago
7 0

Answer:

Mike's recognized gain from the transfer of the house to him is:

$175,000

Explanation:

a) Data and Calculations:

Marital property = $1,500,000

Cost of property =  $575,000

Residual value =     $925,000

Alimony to Karen = $750,000 ($150,000 * 5)

Balance (Mike's) =  $175,000

$175,000 represents the excess of the fair market value of the marital property after deducting the cost of property and the alimony paid to Karen.  A gain of $175,000 is recognized by Mike after the property sale.

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3 years ago
A company wants to market different types of shampoo using color-coded bottles, lids, and label print. It has four different col
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Answer: 40 types

Explanation:

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3 years ago
The investments of Steelers Inc. include a single investment: 42,730 shares of Bengals Inc. common stock purchased on September
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Answer:

Explanation:

A. The journal entries are shown below:

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