In early 2021, Specific Auto Auction had a warehouse that was destroyed by an earthquake. This...
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In early 2021, Specific Auto Auction had a warehouse that was destroyed by an earthquake. This warehouse was originally purchased for $345,000 and depreciation deductions of $75,000 have been claimed on the property. Specific received $364,000 proceeds from insurance to purchase a new building. The company found an acceptable building and purchased it for $376,000 in August 2021. A. What type of transaction is this for Specific Auto? B. What is Specific's realized gain on the transaction? (BONUS QUESTION) C. What is Specific's recognized gain on the transaction? In early 2021, Specific Auto Auction had a warehouse that was destroyed by an earthquake. This warehouse was originally purchased for $345,000 and depreciation deductions of $75,000 have been claimed on the property. Specific received $364,000 proceeds from insurance to purchase a new building. The company found an acceptable building and purchased it for $376,000 in August 2021. A. What type of transaction is this for Specific Auto? B. What is Specific's realized gain on the transaction? (BONUS QUESTION) C. What is Specific's recognized gain on the transaction?
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A For Specific auto Ware house is a capital assetIt is not related to regular purchase and sales rel... View the full answer
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