capital gain/loss on the disposal of the car is: Select one: a. None of the above as there is no capital gain or loss on the disposal of the vehicle b. R 60 000 gain c. R57 600 loss d. R60 000 loss
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- Nicky receives a car from Sam as a gift. Sam paid 48,000 for the car. He had used it for business purposes and had deducted 10,000 for depreciation up to the time he gave the car to Nicky. The fair market value of the car is 33,000. a. Assuming that Nicky uses the car for business purposes, what is her basis for depreciation? b. Assume that Nicky deducts depreciation of 6,500 and then sells the car for 32,500. What is her recognized gain or loss? c. Assume that Nicky deducts depreciation of 6,500 and then sells the car for 20,000. What is her recognized gain or loss?LO.3 Seojun acquired an activity several years ago, and in the current year, it generates a loss of 50,000. Seojun has AGI of 140,000 before considering the loss from the activity. If the activity is a bakery and Seojun is not a material participant, what is his AGI?Virginia has business property that is stolen and partially destroyed by the time it was recovered. She receives an insurance reimbursement of $6,000 on property that had a $14,000 basis and a decrease in market value of $10,000 due to damage caused by the theft. What is the amount of Virginia's casualty loss? $14,000 $8,000 $10,000 $4,000 None of the above
- On January 4, 1986, Rita Racksaw purchased a warehouse for $150,000. In 2020, she sold the warehouse for $107,000. She took $150,000 depreciation under ACRS and straight-line depreciation would have been $150,000. How much and what type of income or gain would Rita have on the sale? $43,000 Section 1231 loss $107,000 Section 1231 gain $107,000 long-term capital gain $107,000 ordinary incomeVirginia has business property that is stolen and partially destroyed by the time it was recovered. She receives an insurance reimbursement of $5,000 on property that had a $14,000 basis and a decrease in market value of $10,000 due to damage caused by the theft. What is the amount of Virginia's casualty loss? a.$4,000 b.$5,000 c.$14,000 d.$10,000 e.None of these choices are correct.Bob sold manufacturing equipment to a dealer for $50,000. He bought the equipment for $55,000 several years ago and has claimed $12,500 of depreciation expense on the equipment. What is the amount and character of the gain or loss for Bob on the equipment? Question options: 7500 Section 1231 gain 7500 Section 1250 gain 7500 Ordinary income 7500 capital gain None of the above
- Jake parchased a $235,000 crane for his constraction business. He sold the crane for $175,000 after taking $115,000 of depreciation. Assume take is What is the amount of gain or loss on the sale?5. In year 0, Canon purchased a machine to use in its business for $56,000. In year 3, Canon sold the machine for $42,000. Between the date of the purchase and the date of the sale, Canon depreciated the machine by $32,000. (Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) d. What are the amount and character of the gain or loss Canon will recognize on the sale, assuming that it is a corporation and the sale proceeds were decreased to $20,000? Total Gain/Loss Recognized? Ordinary Gain/Loss? 1231 Gain/Loss?Owe ramsin is upgrading her factory equipment this year and sells her old equipment. The old equipment had an original basis of $2,000 but has since been fully depreciated. Ramsin sells the property for $1,500. What are the tax consequences for Ramsin on the sales? 1. $1,500 ordinary income 2. No effect 3. $500 ordinary loss 4. $1,500 capital gain
- Joe's Restaurant Inc. purchased an oven for $10,000 and takes $9,000 of depreciation on that oven over three years. Under IRC §1011 the basis of the oven is $1,000. A sells the oven for $20,000 thereby realizing a gain of $19,000. How much of the gain is recaptured as ordinary income, and how much is treated as §1231 gain . a. 9,000 recaptured as ordinary income 10,000 treated as §1231 gain b. 10,000 recaptured as ordinary income 9,000 treated as §1231 gain c. 19,000 recaptured as ordinary income none treated as §1231 gain d. none recaptured as ordinary income 19,000 treated as §1231 gain77 Week 5 Discussion Forum Umair sold some equipment he used in his business in 8/29/19 that was originally purchased for $65,000 on 11/21/18. The equipment was depreciated using the 7 yr MACRS method for a total of $17,249. Assume there is no additional netting of gains and losses for this taxpayer: Assume Umair sold the equipment for $45,000: 1. What is the amount of realized gain or loss on the sale of equipment? 2. Is the nature of the gain or loss considered ordinary or long term?
