In year 0, Longworth Partnership purchased a machine for $46,250 to use in its business. In year
Question:
In year 0, Longworth Partnership purchased a machine for $46,250 to use in its business. In year 3, Longworth sold the machine for $34,700. Between the date of the purchase and the date of the sale, Longworth depreciated the machine by $25,700.
a, What is the amount and character of the gain (loss) Longworth will recognize on the sale?
Total Gain/Loss recognized________
Character of recognized gain:
Ordinary Gain/loss________
1231 Gain/loss_________
b. What is the amount and character of the gain (loss) Longworth will recognize on the sale if the sale proceeds were increased to $60,500?
Total Gain/Loss recognized________
Character of recognized gain:
Ordinary Gain/loss________
1231 Gain/loss_________
c. What is the amount and character of the gain (loss) Longworth will recognize on the sale if the sale proceeds were decreased to $19,500?
Total Gain/Loss recognized________
Character of recognized gain:
Ordinary Gain/loss________
1231 Gain/loss_________
Taxation Of Individuals And Business Entities 2015
ISBN: 9780077862367
6th Edition
Authors: Brian Spilker, Benjamin Ayers, John Robinson, Edmund Outslay, Ronald Worsham, John Barrick, Connie Weaver