5. Determine the total gain from change in fair value as of December 31, 2019. *626,400831,6001,004,4001,080,000None of the choices During 2019, you were asked to audit the goat farm operations of Google Company. Thebusiness owns and operates a goat farm that qualifies to be accounted for as Agricultureunder PAS 41. On December 31, 2019, the biological assets are:RSPurchased before January 1, 2019Purchased on January 1, 2019Purchased on July 1, 20193 years old 1,260 goats2 years old1.5 years old180 kids450 kidsThere were no other transactions during the year concerning the biological assets. Noanimals were born during the year and no animals were sold during the year. Given beloware the dates regarding the selling price and costs to sell of the biological assets.January 1, 2019:1 year old2 years oldJuly 1, 2019:Selling PriceBAGUIP 1,900Cost to SellP1002,480801 year oldDecember 31, 2019:1 year old2 years old1.5 years old1,850502,000802,8002,200100403 years old3,500500

The fair value of the biological asset is determined as the selling price minus the cost to sell.

During 2019, you were asked to audit the goat farm operations of Google Company. The business owns and operates a goat farm that qualifies to be accounted for as Agriculture under PAS 41. On December 31, 2019, the biological assets are: Purchased before January 1, 2019 Purchased on January 1, 2019 Purchased on July 1, 2019 3 years old 2 years old 1.5 years old 1,260 goats 180 kids 450 kids There were no other transactions during the year concerning the biological assets. No animals were born during the year and no animals were sold during the year. Given below are the dates regarding the selling price and costs to sell of the biological assets. TIA January 1, 2019: 1 year old 2 years old July 1, 2019: 1 year old December 31, 2019: 1 year old 2 years old 1.5 years old 3 years old Selling Price BAGUIP 1,900 Cost to Sell P100 2,480 80 1,850 50 2,000 80 2,800 2,200 100 40 3,500 500 RS

During 2019, you were asked to audit the goat farm operations of Google Company. The business owns and operates a goat farm that qualifies to be accounted for as Agriculture under PAS 41. On December 31, 2019, the biological assets are: Purchased before January 1, 2019 Purchased on January 1, 2019 Purchased on July 1, 2019 3 years old 2 years old 1.5 years old 1,260 goats 180 kids 450 kids There were no other transactions during the year concerning the biological assets. No animals were born during the year and no animals were sold during the year. Given below are the dates regarding the selling price and costs to sell of the biological assets. TIA January 1, 2019: 1 year old 2 years old July 1, 2019: 1 year old December 31, 2019: 1 year old 2 years old 1.5 years old 3 years old Selling Price BAGUIP 1,900 Cost to Sell P100 2,480 80 1,850 50 2,000 80 2,800 2,200 100 40 3,500 500 RS

Individual Income Taxes

43rd Edition

ISBN:9780357109731

Author:Hoffman

Publisher:Hoffman

Chapter17: Property Transactions: §1231 And Recapture Provisions

Section: Chapter Questions

Problem 2RP

See similar textbooks

Similar questions

Herald Company has different kinds of farm animals on January 1, 2020. During the year, severalacquisitions occurred related to these farm animals. A detailed summary of these transactions is asfollows:Carrying value on January 1, 2020Qty Amount2-year old Hogs 20 P180,0002.5-year old Hogs 10 190,0001-year old Horses 15 650,0003-year old Cattle 10 950,000Purchases on June 30, 20201.5-year-old Hogs 15 P230,000Fair value less cost to sell on December 31, 20202-year old Hogs 20 P190,5002.5-year old Hogs 10 201,0001-year old Horses 15 675,0003-year old Cattle 10 925,0001.5 year old Hogs 15 240,000Fair value less cost to sell on December 31, 20203-year old Hogs 20 P202,5003.5-year old Hogs 10 204,0002-year old Horses 15 670,0004-year old Cattle 10 935,0002-year old Hogs 15 246,500There were no animals sold or born during the year.Requirements:1. Compute the biological asset at the end of December 31, 2020.2. Compute the unrealized holding gains or losses attributable to price changes and…
Dhofar Dairy Company reported profit of OMR 60,000 during year 2019. During 2019 the company purchased laptops costing OMR 4,500 for its employees. The accountant of the company expensed the cost of laptops during 2019. How much is the taxable income as per Oman Tax Law after adjusting the cost of laptops and its depreciation expense? а. OMR 63,000 b. OMR 64,500 С. OMR 57,000 d. OMR 66,000
Make use of the following information to answer the following questions below. Mr. B has a farm of 2200ha. He Plants 1750ha maize and uses 450ha as veld for his livestock. The buildings and fixed improvements are located on the remainder of the farm. He also rents a 3 ha of land in Botlokwa, where he produces macademia nuts. Mr. B provides the following Financial information for his farm business for the period 1 April 2020 to 30 April 2020. Description of transaction Amount / Value Cash sales of maize R 1 850 000. Credit sales of livestock to local butcher R 32 000. Cash sales of livestock R 1 500 900. Cash payment: Instalment on long-term loan at Land Bank (interest) R 254 400. Receive cash from neighbour for fields ploughed on contract R 49 000. Cash sale from old tractor R 189 000. Slaughter heifer for household consumption R 18 300. Purchased crop chemicals on credit from a co-operative R 200 500. Wages paid R 88 400. Receive cash from insurance for a bull struck…
Jack Motors manufactures a range of motor cars and its year end is 31* January 2019. You are the audit supervisor of Ayeyi & Partners and are currently preparing the audit programmes for the year-end audit of Jack Motors. You have had a meeting with your audit manager and he has notified you of a number of issues identified during the audit risk assessment process. Land and buildings Jack Motors have a policy of revaluing land and buildings, this is undertaken on a rolling basis over a five-year period. During the year Jack Motors requested an external valuer to revalue a number of properties, including a warehouse purchased in May 2018. Depreciation is charged on a pro rata basis. Work in progress Jack Motors undertakes continuous production of cars, 24 hours a day, and seven days a week. An inventory count is to be undertaken at the year end and Ayeyi & Partners will attend. You are responsible for the audit of work in progress (WIP) and will be part of the team attending the count…
Use the following information for the next three questions. HANNAH Company has a herd of 10 2-year old animals on January 1, 2018. One animal aged 2.5 years was purchased on July 1, 2018 for PI08, and one animal was born on July 1, 2018. No animals were sold or disposed of during the year. The fair value less to sell per unit is as follows: 2 - year old animal on January I 1.5 - year old animal on July 1 New born animal on July 1 2 - year old animal on December 31 2.5 - year old animal on December 31 100 108 70 105 111 Newborn animal on December 31 2 - year old animal on December 31 0.5 - year old animal on December 31 72 120 80 1|Page 5. What is the fair value of the biological assets on December 31,2018? 6. What is the gain from change in fair value of biological assets to be recognized in 2018? 7. What is the gain from change in fair value due to price change?
Price Company from time to time embarks on a research program when a special project seems to offer possibilities. In 2019, the company expends $325,000 on a research project, but by the end of 2019 it is impossible to determine whether any benefit will be derived from it. Instructions a. What account should be charged for the $325,000, and how should it be shown in the financial statements? b. The project is completed in 2020, and a successful patent is obtained. The R&D costs to complete the project are $110,000. The administrative and legal expenses incurred in obtaining patent number 472-1001-84 in 2020 total $16,000. The patent has an expected useful life of 5 years. Record these costs in journal entry form. Also, record patent amortization (full year) in 2020. c. In 2021, the company successfully defends the patent in extended litigation at a cost of $47,200, thereby extending the patent life to December 31, 2028. What is the proper way to account for this cost? Also, record…
An entity cultivates cattle for the beef industry. On December 31, 2020 the entity's herds included 500, 18-month-old cattle. On December 2016 the quoted price for live cattle delivered to the local slaughterhouse to which the entity delivers its livestock is P 300 per 18-month-old animal. The slaughterhouse is located 25 miles from the entity's farmland where the cattle are raised. Carriers providing cattle transport services to the entity charge P65 per trip from the entity's farm to the slaughterhouse using a 10-cow carrier. No incremental selling costs arise on the sale to the slaughterhouse. On December 31, 2020 the fair value less costs to sell of the herd of cattle (biological assets) is a. P 117.500 b. P 119,935 c. P146,750 d. 150,000
Jack Motors manufactures a range of motor cars and its year end is 31st January 2019. You are the audit supervisor of Ayeyi & Partners and are currently preparing the audit programmes for the year-end audit of Jack Motors. You have had a meeting with your audit manager and he has notified you of a number of issues identified during the audit risk assessment process.Land and buildingsJack Motors have a policy of revaluing land and buildings, this is undertaken on a rolling basis over a five-year period.During the year Jack Motors requested an external valuer to revalue a number of properties, including a warehouse purchased in May 2018. Depreciation is charged on a pro rata basis.Work in progressJack Motors undertakes continuous production of cars, 24 hours a day, and seven days a week. An inventory count is to be undertaken at the year end and Ayeyi & Partners will attend. You are responsible for the audit of work in progress (WIP) and will be part of the team attending the…
Taxpayer purchased the following assets in 2021: January 10 Machine $10,000 September 30 Computer $2,000 December 20 Warehouse $70,000 The convention used for MACRS personal property in 2021 is O Mid-month O Half-year Mid-quarter
You are working as the chief accountant of Ganyu Co., who does business in a specialized industry.Ganyu is into agriculture, the company owns a coffee plantation and raises animals for their meat andother produce. During the year, a farmland with a mango plantation and rice fields was also acquired.Information about the animals Ganyu held were as follows:Ganyu Co. has the following animals as of January 1, 2021:350 cows (average age, 2 years old)200 heifers (average age, 1-year old)Ganyu also purchased 175 heifers, average age 1-year old, on July 1, 2021Also, 75 animals were born on July 1, 2021.The unit values less estimated costs to sell were.1-year old animal at December 31, 2021 P12,2002-year old animal at December 31, 2021 14,5001.5-year old animal at December 31, 2021 12,6003-year old animal at December 31, 2021 15,0001-year old animal at January 1, 2021 and July 1, 2021 12,0002-year old animal at January 1, 2021 14,0000.5 year old at December 31, 2021 4,000Newborn at July 1,…
You are working as the chief accountant of Ganyu Co., who does business in a specialized industry.Ganyu is into agriculture, the company owns a coffee plantation and raises animals for their meat andother produce. During the year, a farmland with a mango plantation and rice fields was also acquired. Information about the animals Ganyu held were as follows:Ganyu Co. has the following animals as of January 1, 2021:350 cows (average age, 2 years old)200 heifers (average age, 1-year old)Ganyu also purchased 175 heifers, average age 1-year old, on July 1, 2021Also, 75 animals were born on July 1, 2021.The unit values less estimated costs to sell were.1-year old animal at December 31, 2021 P12,2002-year old animal at December 31, 2021 14,5001.5-year old animal at December 31, 2021 12,6003-year old animal at December 31, 2021 15,0001-year old animal at January 1, 2021 and July 1, 2021 12,0002-year old animal at January 1, 2021 14,0000.5 year old at December 31, 2021 4,000Newborn at July 1,…
On April 18, 2019, Botanica Company, a garden retailer, purchased $9,800 of seed, terms 2/10, n/30, from Whitetail Seed Co. Even though the discount period had expired, Shelby Davey subtracted the discount of $196 when he processed the documents for payment on May 1, 2019. Discuss whether Shelby Davey behaved in a professional manner by subtracting the discount even though the discount period had expired.