udent question Time to preview question: 00:09:37 Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $102,000, and it has claimed $33,800 of depreciation expense against the building. Note: Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Round your final answers to the nearest whole dollar amount. Required: Assuming that Hauswirth receives $80,500 in cash for the warehouse, compute the amount and character of Hauswirth's recognized gain or loss on the sale. Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $80,500, compute Hauswirth's realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land. Assuming that Hauswirth receives $27,500 in cash in year 0 and a $88,500 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1.

udent question Time to preview question: 00:09:37 Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $102,000, and it has claimed $33,800 of depreciation expense against the building. Note: Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Round your final answers to the nearest whole dollar amount. Required: Assuming that Hauswirth receives $80,500 in cash for the warehouse, compute the amount and character of Hauswirth's recognized gain or loss on the sale. Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $80,500, compute Hauswirth's realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land. Assuming that Hauswirth receives $27,500 in cash in year 0 and a $88,500 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1.

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter13: Corporations: Earning & Profits And Distributions

Section: Chapter Questions

Problem 11P

See similar textbooks

tudent question

Time to preview question:

00:09:37

Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $102,000, and it has claimed $33,800 of depreciation expense against the building.

Note: Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Round your final answers to the nearest whole dollar amount.

Required:

Assuming that Hauswirth receives $80,500 in cash for the warehouse, compute the amount and character of Hauswirth's recognized gain or loss on the sale.

Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $80,500, compute Hauswirth's realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land.

Assuming that Hauswirth receives $27,500 in cash in year 0 and a $88,500 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1.

Definition Video Definition Accounting method wherein the cost of a tangible asset is spread over the asset's useful life. Depreciation usually denotes how much of the asset's value has been used up and is usually considered an operating expense. Depreciation occurs through normal wear and tear, obsolescence, accidents, etc. Video

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step 3

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

On October 31, 20x4, Mr. Cruz bought properly from D'Vision Heights which had earlier cost the latter P250,000. The company received a dwon payment of P100,000 an a P400,0000 mortgage note payable in twenty equal semiannual installments plus 16% interest per annum an unpaid principal. Assuming the gross profit is recognized in the period of sale, the amount of gross profit to be recognized by D'Vision Heights in 20x6 would a. P 50,000 b. P 250,000
On Jan. 1, 20x1, an entity has an outstanding note payable with carrying amount of P 1,000,000. On this date, the debtor agrees to receive the equipment with historical cost of P 1,800,000, accumulated depreciation of P 900,000 and fair value of P 850,000 in full settlement of the note payable. Compute for the gain or loss on the derecognition of the notes payable:a. P 0b. P 150,000 gainc. P 50,000 lossd. P 100,000 gain
On October 31 , 20x4 , Mr . Cruz bought property from D'Vision Heights which had earlier cost the latter P250,000 . The company received a down payment of P100.000 and a P400,000 mortgage note payable in twenty equal semiannual installments plus 16 % interest per annum on unpaid principal . Assuming the gross profit is recognized in the period of sole of gross profit to be recognized by D'Vision Heights in 20x6 would be :
Computation of taxable income. The records for Bosch Co. show this data for 2018: · Gross profit on installment sales recorded on the books was $480,000. Gross profit from collections of installment receivables was $320,000. Life insurance on officers was $3,800. Machinery was acquired in January for $300,000. Straight-line depreciation over a ten-year life (no salvage value) is used. For tax purposes, MACRS depreciation is used and Bosch may deduct 14% for 2018. Interest received on tax exempt Iowa State bonds was $9,000. The estimated warranty liability related to 2018 sales was $21,600. Repair costs under warranties during 2018 were $13,600. The remainder will be incurred in 2019. Pretax financial income is $700,000. The tax rate is 30%. Instructions (a) Prepare a schedule starting with pretax financial income and compute taxable income. (b) Prepare the journal entry to record income taxes for 2018.
On January 1, 2022, Malia sold property carried in inventory at a cost of P1,312,710 for P2,100,000. A 20% down payment was made and the balance payable in 4 equal installments of P420,000, payable semi-annually every June 30 and December 31. Expenses related with sale, P100,000. (Market rate of interest-12%). How much is the net income related with the installment sales for the year ended December 31, 2022?
The records for Pharoah Co. show this data for 2021: ● Gross profit on installment sales recorded on the books was $480,000. Gross profit from collections of installment receivables was $340,000. ● Life insurance on officers was $4,400. ● Machinery was acquired in January for $360,000. Straight-line depreciation over a ten-year life (no salvage value) is used. For tax purposes, MACRS depreciation is used and Pharoah may deduct 14% for 2021. ● Interest received on tax exempt Iowa State bonds was $9,600. ● The estimated warranty liability related to 2021 sales was $22,200. Repair costs under warranties during 2021 were $14,200. The remainder will be incurred in 2022. ● Pretax financial income is $660,000. The tax rate is 20%. (a) Prepare a schedule starting with pretax financial income and compute taxable income. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Schedule of…
PROBLEM 1 Xavier Company provided the following information for its first year of operations ended December 31, 2021 in connection with the preparation of its income tax return:Taxable income P 4,000,000Non-deductible expenses 200,000Non-taxable revenue 300,000Deferred income on installment saleincluded in financial income but taxable in 2022 450,000Doubtful accounts recorded 100,000Financial depreciation 300,000Tax depreciation 350,000Estimated warranty cost accrued in2021 but not deductible for tax purposes until paid…
On January 1, 20x1, an entity has an outstanding note payable with carrying amount of P1,000,000. On this date, the debtor agrees to receive equipment with historical cost of P1,800,000, accumulated depreciation of P900,000 and fair value of P850,000 in full settlement of the note payable. Requirement: Compute for the gain or loss on the derecognition of the note payable.
Daze Corporation appropriately uses the installment-sales method of accounting to recognize income in its financial statements. The following information is available for 2020 and 2021. 2020 2021 Installment sales $800,000 $1,000,000 Cost of installment sales 480,000 650,000 Cash collections on sales of 2020 300,000 500,000 Cash collections on sales of 2021 -0- 400,000 Compute the amount of realized gross profit recognized in each year.
On February 1, 2020, Henson Company factored receivables with a carrrrying amount of $700,000 to Agee Company. Agee Company assesses a finance charge of 3% of the receivables and retains 5% of the receivables. Relative to this transaction, you are to determine the amount of loss on sale to be reported in the income statement of Henson Company for February. Assume that Herson factors the receivables on a with recourse basis. The recourse obligation has a fair value of $3,500. The loss to be reported is ?
On January 1, 2020 SANA ALL MAHAL Co. acquired land by issuing a three-year,12%, P4,000,000 note payable. Principal and interest are due on December 31,2022. How much is the interest expense in 2021?a. P1,017,600b. P960,000c. P537,600d. P764,213
If the beginning balance in Swan, Inc.’s OAA is $6,700 and the following transactions occur, what is Swan’s ending OAA balance? Depreciation recapture income $ 21,600Payroll tax penalty (4,200) Tax-exempt interest income 4,012Nontaxable life insurance proceeds 100,000 Life insurance premiums paid (nondeductible) (3,007)