Exercise 13-30 (Algorithmic) (LO. 3)Juliana purchased land three years ago for $55,000. She made a gift of the land to Tom, her brother, in the currentyear, when the fair market value was $77,000. No Federal gift tax is paid on the transfer. Tom subsequently sells theproperty for $69,300.a. Tom's basis in the land is ssale.and he has a realizedof $and he has a realizedon theb. Assume, instead, that the land has a fair market value of $49,500 on the date of the gift, and that Tom sold theland for $47,025.Tom's basis in the land is ssale.on the

The following formula used as follows:-Realized Capital Gain arrises where Fair value > Purchased…

Answered: Juliana purchased land three years ago…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Tori owns a nondepreciable capital asset held for investment. The asset was purchased for $400,000 six years earlier and is now subject to a $70,000 liability. During the current year, Tori transfers the asset to Travis in exchange for $125,000 cash and a new automobile with a $20,000 fair market value (FMV) to be used by Tori for personal use; Travis assumes the $70,000 liability. Requirement Determine the amount of Tori's long-term capital gain (LTCG) or long-term capital loss (LTCL). (Use parentheses or a minus sign to enter a loss.) Tori will realize a long-term capital gain or loss of
Charla owns land used in her business with a basis of $70,000 and a fair market value of $100,000. She is planning to exchange the land for a warehouse owned by Jim and used in his business. Jim's warehouse has a basis of $50,000 and a fair market value of $150,000. The warehouse is also subject to a liability of $50,000. Charla has agreed to assume the liability for Jim. Requirement What is Jim's recognized gain and his basis in the new land? **** Begin by calculating the realized gain. First identify the formula, then enter the applicable amounts and calculate the realized gain. Realized gain
Sean sells land to Eli, his brother, for the fair market value of $39,000. Six months later when the land is worth $45,000, Eli sells the property to his son, Jon, without gift tax. His son sells the land for $47,000. Sean’s adjusted basis for the land is $24,000 what is Jon’s recognized gain or loss on the sales?
On September 30 of last year, Rex received some investment land from Holly as a gift. Holly's adjusted basis was $50,000 and the land was valued at $40,000 at the time of the gift. Holly acquired the land five years ago. What are the amount and character of Rex's recognized gain (loss) if he sells the land on May 12 this year at the following prices? (Enter NA if a situation is not applicable. Leave no answer blank. Enter zero if applicable.) a. Land sold for $32,000 Amount
Alicia sold her personal residence to Rick for $300,000. Before the sale, Alicia paid the real estate tax of $4,380 for the calendar year. For income tax purposes, the deduction is apportioned as follows; $2,160 for Alicia and $2,220 for Rick. What is Ricks basis in the residence?
Randy established a trust, reserving in himself the power to terminate the trust if he is not satisfied with its operation. After two years, the power to terminate the trust expires. Randy transferred commercial real estate into the trust and specified that the income be payable annually for the benefit of his adult daughter, Michelle. Randy died one year after creation of the trust instrument. One estate tax implication for Randy of this trust is that the trust property is A) included in his estate because a family member is receiving a benefit from the trust. B) not included in his estate because a transfer for the benefit of a minor is exempt from tax. C) included in Randy's estate because he still had the power to terminate the trust at his death. D) not included in his estate because the power to terminate the trust eventually expires.
Andrew and Brianna are married and live in Texas, a community property state. For their birthdays this year Andrew gave cash gifts of $22,100 to each of his two daughters, and Brianna gave $36,800 to her niece. What is the amount of Andrew's taxable gifts? Multiple Choice O $3,400. $10,000. $25,000. zero if Andrew and Brianna elect to split gifts. None of the choices are correct.
Lisa sells business property with an adjusted basis of $132,000 to her son, Alfred, for its fair market value of $105,600. If an amount is zero, enter "0". a. What is Lisa's realized and recognized gain or loss? Lisa has a $__________ realized loss of which $___________is recognized. b. What is Alfred's recognized gain or loss if he subsequently sells the property for $145,200? For $85,800? If Alfred sells the property for $145,200, he has a recognized gain of $_______________. If Alfred sells the property for $85,800, he has a recognized loss of $_______________.
Kase, an individual, purchased some property in Potomac, Maryland, for $166,000 approximately 10 years ago. Kase is approached by a real estate agent representing a client who would like to exchange a parcel of land in North Carolina for Kase's Maryland property. Kase agrees to the exchange. What is Kase's realized gain or loss, recognized gain or loss, and basis in the North Carolina property in each of the following alternative scenarios? Note: Loss amounts should be indicated by a minus sign. Leave no answers blank. Enter zero if applicable. b. The transaction qualifies as a like-kind exchange, and the fair market value of each property is $101,000.
Isaac buys a piece of land as an investment, paying $20,000. Three years later he trades the land to Isadore for a piece of land worth $26,000. Isaac holds the new land as an investment 1) What is Isaac’s adjusted basis in the new property he receives? 2) What is Isaac’s holding period in the new land he receives?
* Explain.
oshua owns undeveloped land that has an adjusted basis of $45,000. He exchanges it for other undeveloped land with an FMV of $70,000. Required: What are his realized and recognized gain or loss on the exchange? Note: If no gain or loss is recognized, select "No gain or loss". What is his basis in the acquired land?

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