Question

A corporation owns an office building and land. The office building and land were acquired in...

A corporation owns an office building and land. The office building and land were acquired in 1978 for $1,100,000 and $80,000 respectively. During the current year, the properties are sold for $1,180,000 with 40% of the selling price being allocated to the land. The assets as shown on the corporation's books before their sale are as follows:

Building                    $1,100,000

Acc. Depreciation     $980,000 (a)                     $120,000

Land                                                                       $80,000

(a) if the straight line method of depreciation had been used, the accumulated depreciation would be $1,145,000.

a. What is the recognized gain due to the sale of the building?

b. What is the character of the recognized gain due to the sale of the building?

c. What is the recognized gain and character of the gain due to the sale of the land?

Homework Answers

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Carl owns an office building and land that are used in his trade business. The office...
Carl owns an office building and land that are used in his trade business. The office building and land were acquired in 1978 for $1,100,000 and $80,000 respectively. During the current year, the properties are sold for $1,180,000 with 15% of the selling price being allocated to the land. The assets as shown on the taxpayer's books are as follows: Building   $1,100,000 Accumulated depreciation 980,000(a) $120,000 Land 80,000 (a) If the straight-line method of depreciation had been used, the accumulated...
Simpson and Homer Corporation acquired an office building on three acres of land for a lump-sum...
Simpson and Homer Corporation acquired an office building on three acres of land for a lump-sum price of $2,450,000. The building was completely furnished. According to independent appraisals, the fair values were $840,000, $840,000, and $1,120,000 for the building, land, and furniture and fixtures, respectively. The initial values of the building, land, and furniture and fixtures would be: Building Land Fixtures a. $ 840,000​ $ 840,000​ $ 1,120,000​ b. $ 735,000​ $ 735,000​ $ 980,000​ c. $ 735,000​ $ 735,000​...
Sammy Corporation acquired an office building on two acres of land for a lump-sum price of...
Sammy Corporation acquired an office building on two acres of land for a lump-sum price of $800,000. The building was completely furnished. According to independent appraisals, the fair values were $500,000, $300,000, and $200,000 for the building, land, and furniture, respectively. What should be the amount of initial value for the land?
A company acquired an office building on three acres of land for a lump-sum price of...
A company acquired an office building on three acres of land for a lump-sum price of $2,400,000. The building was completely equipped. According to independent appraisals, the fair values were $1,300,000, $780,000, and $520,000 for the building, land, and equipment, respectively. At what amount would the company record the building? Multiple Choice $720,000. $1,200,000. None of these answer choices are correct. $1,300,000.
On September 3, 2015, Ivory Company acquired an apartment building for $1,500,000 (with $300,000 being allocated...
On September 3, 2015, Ivory Company acquired an apartment building for $1,500,000 (with $300,000 being allocated to the land). The straight-line cost recovery method was used. The property was sold on September 30, 2018, for $1,400,000. Click here to access the Exhibit for MACRS Straight-Line Depreciation for Real Property. If an amount is zero, enter "0". Round the total cost recovery deduction to the nearest dollar. a. The cost recovery is $________, and the adjusted basis for the building is...
3. Mary owns an apartment building that has an adjusted basis of $1,080,000 but subject to...
3. Mary owns an apartment building that has an adjusted basis of $1,080,000 but subject to a mortgage of $320,000. Mary transfers the apartment building to Gary, and receives from Gary $230,000 in cash and an office building with a fair market value of $880,000 at the time of the exchange. Gary assumes the $320,000 mortgage on the apartment. The transfer is a like-kind exchange. a) what is Mary’s realized gain/ loss? b) what is Mary’ recognized gain/loss? c) what...
Delta Corporation exchanges a warehouse for an office building from Gamma Corporation. Delta’s warehouse has a...
Delta Corporation exchanges a warehouse for an office building from Gamma Corporation. Delta’s warehouse has a fair market value of $4,000,000 and a basis of $2,250,000. The office building has a fair market value of $3,750,000, so Delta received $250,000 cash from Gamma to complete the exchange. What are Delta’s realized and recognized gain or loss on the exchange? Realized gain or loss: Recognized gain or loss: What is its deferred gain or loss? Deferred gain of $ What is...
Louis owns three pieces of land with an adjusted basis as follows: parcel A, $75,000; parcel...
Louis owns three pieces of land with an adjusted basis as follows: parcel A, $75,000; parcel B, $125,000; and parcel C, $175,000. Louis sells parcel A to his uncle for $50,000, parcel B to his partner for $120,000, and parcel C to his mother for $150,000. If an amount is zero, enter "0". a. What is the recognized gain or loss from the sale of each parcel? The recognized loss of Parcel A is $. The recognized loss of Parcel...
Moran owns a building he bought during year 0 for $179,000. He sold the building in...
Moran owns a building he bought during year 0 for $179,000. He sold the building in year 6. During the time he held the building he depreciated it by $47,000. What is the amount and character of the gain or loss Moran will recognize on the sale in each of the following alternative situations? (Loss amounts should be indicated by a minus sign. Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) a....
Frank owns an apartment building that he rents to students. Frank originally purchased the building for...
Frank owns an apartment building that he rents to students. Frank originally purchased the building for $900,000 and took straight-line depreciation deductions totaling $400,000. Frank sells the building for $1,000,000 cash and the buyer assumes his mortgage on the building. The mortgage had an original balance of $700,000 and was $425,000 at the time of sale. What is the amount realized , gain or loss realized and gain or loss recognized?
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT