Accumulated Asset Cost Acquired Depreciation Sold for Sold on Rack $110,000 10/10/16 $70,000 $55,000 10/10/19 Forklift 45,000 10/16/15 21,000 15,000 10/10/19 Bin 97,000 03/12/18 31,000 60,000 10/10/19

Accumulated Asset Cost Acquired Depreciation Sold for Sold on Rack $110,000 10/10/16 $70,000 $55,000 10/10/19 Forklift 45,000 10/16/15 21,000 15,000 10/10/19 Bin 97,000 03/12/18 31,000 60,000 10/10/19

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter11: Depreciation, Depletion, Impairment, And Disposal

Section: Chapter Questions

Problem 14RE: (Appendix 11.1) Auburn Company purchased an asset on January 1, Year 1, for 150,000. The asset has a...

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Question

Copper Industries (a sole proprietorship) sold three § 1231 assets during 2019. Data on these property dispositions are as follows: a. Determine the amount and the character of the recognized gain or loss from the disposition of each asset.
b. Assuming that Copper has $6,000 nonrecaptured net § 1231 losses from prior years, analyze these transactions and determine the amount (if any) that will be treated as a long-term capital gain.

Accumulated
Asset
Cost
Acquired
Depreciation
Sold for
Sold on
Rack
$110,000
10/10/16
$70,000
$55,000
10/10/19
Forklift
45,000
10/16/15
21,000
15,000
10/10/19
Bin
97,000
03/12/18
31,000
60,000
10/10/19

Definition Definition Increase in the value of a capital asset and the amount that is realized when the asset is sold off. A capital gain may be short-term or long-term depending on the tenure for which the asset is held.

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