After receiving an inheritance, Sandra Yaworski decided to invest her newly acquired funds in real estate. In
Question:
Each of the properties is a residential condominium unit, and each unit is part of a separate condominium high-rise project. Not all of the units were fully rented during the year of acquisition, and Yaworski determined that her net rental position (before capital cost allowance) for each of the properties was as follows for 20X1:
* Property taxes, insurance, interest, maintenance.
In 20X2, one of Yaworskis close relatives ran into financial difficulty, and she was forced to sell two of the properties in order to provide financial assistance. She sold property 1 for $52,000 (land $12,000, building $40,000) and property 3 for $110,000 (land $24,000, building $86,000). In 20X2, the four properties (including the two sold properties to the date of sale) earned net rental income of $7,000.
Required:
Determine Yaworskis net income from property from the rental properties for 20X1 and 20X2.
Step by Step Answer:
Canadian Income Taxation Planning And Decision Making
ISBN: 9781259094330
17th Edition 2014-2015 Version
Authors: Joan Kitunen, William Buckwold