Question

Eleven years ago, Lynn Inc. purchased a warehouse for $315,000. This year, the corporation sold the warehouse to Firm D for $80,000 cash and D’s assumption of a $225,000 mortgage. Through date of sale, Lynn deducted $92,300 straight-line depreciation on the warehouse.
a. Compute Lynn’s gain recognized on sale of the warehouse.
b. What is the character of this gain?
c. How would your answers change if Lynn is a non-corporate business?


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  • CreatedNovember 03, 2015
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