Questions from Taxation

Q: Refer to the facts in problem 7. In the first year

Refer to the facts in problem 7. In the first year after the year of sale, TPW received payments totaling $106,900 from the purchaser. The total consisted of $67,500 principal payments and $39,400 int...

Q: Company Z exchanged an asset (FMV $16,000)

Company Z exchanged an asset (FMV $16,000) for a new asset (FMV $16,000). Company Z’s tax basis in the old asset was $9,300. a. Compute Company Z’s realized gain, recognized gain, and tax basis in the...

Q: Alice and Brendan exchanged the following business real estate.

Alice and Brendan exchanged the following business real estate. a. If Alice’s adjusted basis in the undeveloped land was $360,000, compute Alice’s realized gain,...

Q: Firm PO and Corporation QR exchanged the following business real estate.

Firm PO and Corporation QR exchanged the following business real estate. a. If PO’s adjusted basis in Marvin Gardens was $403,000, compute PO’s realized gain, rec...

Q: Company B and Firm W exchanged the following business real estate.

Company B and Firm W exchanged the following business real estate. a. If B’s adjusted basis in Black acre was $240,000, compute B’s realized gain, recognized gain...

Q: On June 2, 2018, a tornado destroyed the building in

On June 2, 2018, a tornado destroyed the building in which FF operated a fast-food franchise. FF’s adjusted basis in the building was $214,700. In each of the following cases, determine FF’s recognize...

Q: Company W produces circuit boards in a foreign country that imposes a

Company W produces circuit boards in a foreign country that imposes a 15 percent VAT. This year, Company W manufactured 8.3 million boards at a $5 material cost per unit. Company W’s labor and overhea...

Q: On January 10, 2016, a fire destroyed a warehouse owned

On January 10, 2016, a fire destroyed a warehouse owned by NP Company. NP’s adjusted basis in the warehouse was $530,000. On March 12, 2016, NP received a $650,000 reimbursement from its insurance com...

Q: RP owned residential real estate with a $680,000 adjusted

RP owned residential real estate with a $680,000 adjusted basis that was condemned by City Q because it needed the land for a new convention center. RP received $975,000 condemnation proceeds for the...

Q: Business K exchanged an old asset (FMV $95,000

Business K exchanged an old asset (FMV $95,000) for a new asset (FMV $95,000). Business K’s tax basis in the old asset was $107,000. a. Compute Business K’s realized loss, recognized loss, and tax bas...