Answer:
1. To determine whether she is in the business of being a person who LEASE out property as well as what will be her TAX BASIS for the lease.
2. Ordinary income of $60,000
Explanation:
1. Based on the information given the factors that she should consider in order to determine the amount as well as the character of her income from these circumstances is to determine whether she is in the business of being a person who LEASE out property as well as what will be her TAX BASIS for the lease.
b. Based on the information given we were told that the tenant paid her the amount of $60,000 in order to cancel its obligations under the lease which means that the amount and character of her income from the cancelled lease will be ORDINARY INCOME of the amount of $60,000 which we were told the tenant paid her in order to cancel its obligations under the lease.
Answer:
A gain has a Credit balance and is shown on the Income Statement. C. A loss has a Debit balance and is shown on the Income Statement.
Explanation:
As we know that the revenues and gains contains the normal credit balance while on the other hand the expenses and losses contains the normal debit balance and both are reported on the income statement
The gain would be reported on the credit side of the income statement and the loss would be reported on the debit side of the income statement
So the same is relevant too
Answer:
a. according to the agreement.
Explanation:
Profits or losses, made by a partnership firm shall be divided among its partners in accordance with terms specified in the agreement.
However, in absence of any written or oral agreement among the partners, profits and losses shall be distributed equally among the partners.
Answer:
B. the decline in market value of plant and equipment is determined and recorded
- <u>Depretiation is a measure of how much value our plant and equipement does loose because of use and the pass of the time. </u>
- If depretiation would not exist, we would register the value of plant and equipment as if they worth the same they did when they were bought, wich would be not real.
- As an example, think about an oven in a bakery after using for some years: it is not in the same conditions that it was when new. This lost in the value of the goods (because of usage in this case), is what depretiations tries to account.
