3. Tinnell Industries had gross sales of $30,000 for the year. Its cost for the goods sold was $18,000. Returns and allowances amounted to $2,000. It purchased equipment normally selling for $10,000 at a 20% discount. Based on these facts, what is its gross income for the year 4. A taxpayer pays $200,000 for land and a building in a single transaction. At the time of the purchase, the land and building were appraised at $120,000 and $180,000, respectively. The taxpayer's depreciable basis in the building is: 5. A corporation exchanges machinery plus $20,000 cash for new machinery worth $34,000. At the time of the exchange, the corporation's adjusted basis in the machine it exchanges is $16,000 and its fair market value is $14,000. What amount will the corporation (a) recognize on the exchange and (b) what will be its depreciable basis in the new machine

3. Tinnell Industries had gross sales of $30,000 for the year. Its cost for the goods sold was $18,000. Returns and allowances amounted to $2,000. It purchased equipment normally selling for $10,000 at a 20% discount. Based on these facts, what is its gross income for the year 4. A taxpayer pays $200,000 for land and a building in a single transaction. At the time of the purchase, the land and building were appraised at $120,000 and $180,000, respectively. The taxpayer's depreciable basis in the building is: 5. A corporation exchanges machinery plus $20,000 cash for new machinery worth $34,000. At the time of the exchange, the corporation's adjusted basis in the machine it exchanges is $16,000 and its fair market value is $14,000. What amount will the corporation (a) recognize on the exchange and (b) what will be its depreciable basis in the new machine

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter9: Acquisitions Of Property

Section: Chapter Questions

Problem 42P

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Ngo Company purchased a truck for $54,000. Sales tax amounted to $5,400; shipping costs amounted to $1,200; and one-year registration of the truck was $100. What is the total amount of costs that should be capitalized? A. $60,600 B. $66,100 C. $54,000 D. $59,400
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Jada Company had the following transactions during the year: Purchased a machine for $500,000 using a long-term note to finance it Paid $500 for ordinary repair Purchased a patent for $45,000 cash Paid $200,000 cash for addition to an existing building Paid $60,000 for monthly salaries Paid $250 for routine maintenance on equipment Paid $10,000 for major repairs Depreciation expense recorded for the year is $25,000 If all transactions were recorded properly, what is the amount of increase to the Property, Plant, and Equipment section of Jadas balance sheet resulting from this years transactions? What amount did Jada report on the income statement for expenses for the year?
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