In year 0, Javens Inc. sold machinery with a fair market value of $630,000 to Chris....
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
In year 0, Javens Inc. sold machinery with a fair market value of $630,000 to Chris. The machinery's original basis was $493,920 and Javens's accumulated depreciation on the machinery was $73,000, so its adjusted basis to Javens was $420,920. Chris paid Javens $63,000 immediately (in year 0) and provided a note to Javens indicating that Chris would pay Javens $94,500 a year for six years beginning in year 1. a. What is the amount and character of the gain that Javens will recognize in year 0? b. What amount and character of the gain will Javens recognize in years 1 through 6? Complete this question by entering your answers in the tabs below. Required A Required B What is the amount and character of the gain that Javens will recognize in year 0? (Do not round intermediate computations.) Description Amount Recognized Gain Character of Recognized Gain: Ordinary Gain $1231 gain Required A Required B What amount and character of the gain will Javens recognize in years 1 through 6? (Do not round intermediate computations.) Recognized gain from years 1 through 6 In year 0, Javens Inc. sold machinery with a fair market value of $630,000 to Chris. The machinery's original basis was $493,920 and Javens's accumulated depreciation on the machinery was $73,000, so its adjusted basis to Javens was $420,920. Chris paid Javens $63,000 immediately (in year 0) and provided a note to Javens indicating that Chris would pay Javens $94,500 a year for six years beginning in year 1. a. What is the amount and character of the gain that Javens will recognize in year 0? b. What amount and character of the gain will Javens recognize in years 1 through 6? Complete this question by entering your answers in the tabs below. Required A Required B What is the amount and character of the gain that Javens will recognize in year 0? (Do not round intermediate computations.) Description Amount Recognized Gain Character of Recognized Gain: Ordinary Gain $1231 gain Required A Required B What amount and character of the gain will Javens recognize in years 1 through 6? (Do not round intermediate computations.) Recognized gain from years 1 through 6
Expert Answer:
Answer rating: 100% (QA)
Answer a Event Description Amount Explanation 1 Amount realized ... View the full answer
Related Book For
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren
Posted Date:
Students also viewed these accounting questions
-
In year 0, Javens, Inc. sold machinery with a fair market value of $400,000 to Chris. The machinery's original basis was $317,000 and Javens's accumulated depreciation on the machinery was $50,000,...
-
A printing press priced at a fair market value of $300,000 is acquired in a transaction that has commercial substance by trading in a similar press and paying cash for the difference between the...
-
A printing press priced at a fair market value of $400,000 is acquired in a transaction that has commercial substance by trading in a similar press and paying cash for the difference between the...
-
In Problems 1130, solve each equation by factoring. x 2 + 4x = 0
-
Discuss why market size estimates may differ depending on the method being used. How can such differences be reconciled?
-
At a certain university, each student who tries to purchase concert tickets for an upcoming show is successful at connecting to the concert ticket website with probability 0.85. If unsuccessful in...
-
The price of a share is \(\$ 25\), and after two months it will be \(\$ 23\) or \(\$ 27\). The risk-free interest rate is \(10 \%\) per year, continuously compounded. If \(S_{T}\) is the price of the...
-
Refer to the GrandScapes data set. Requirements 1. Compute the variable manufacturing overhead variances. What do each of these variances tell management? 2. Compute the fixed manufacturing overhead...
-
Why was opening trade with China permanently different from other trade agreements? What were its positive and negative impacts on the US?
-
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 Customer ID 652-54310 Results of A/R Confirmations Complete the worksheet below by reviewing the accounts receivable confirmation...
-
Supertech has produced a 10 exabyte hard drive. To support the larger capacity, they had to change the sector size to 4096 bytes. Design a counter layout like that shown in Figure 9.16 to support...
-
BQW's United States (US) regional division reported $40,000 of revenue, $13,000 of variable costs and $10,000 of traceable fixed costs. Common fixed costs amounted to $2,500. What was the segment...
-
A carpenter holds a 14-lb 2-in. by 4-in. board as shown. If he exerts vertical forces on the board, determine the forces at A and B (use positive if the force is up and negative if down). A Answers:...
-
Compare the volume required for a completely mixed flow reactor to that of a plug flow reactor to achieve a 104 reduction in the coliform count of a treated wastewater effluent. As per Chick's Model,...
-
Gamma acquired 60% of Delta's shares on January 1, 2024 paying $500,000 in cash. Delta's balance sheet as of January 1, 2024 and the fair value of Delta's assets and liabilities were as follows:...
-
ps://mybscbryantstratton.edu/webapps/assessment/take/launch.jsp?course_assessment_id=_361377_18course_id=_93... A Question Completion Status: QUESTION 10 8.5 points Compose a statement that correctly...
-
Identify the engineering discipline you want to pursue, then research that discipline. Explain what those engineers do. Explain why you would like to enter that discipline. Your response should be at...
-
The Higher the time period of the financial security the higher the. ............... risk. O a. Maturity O b. Default and Maturity Oc. Default O d. Liquidity
-
Equipment acquired at the beginning of the year at a cost of $145,000 has an estimated residual value of $18,000 and an estimated useful life of five years. Determine (a) The double-declining-balance...
-
The assets and liabilities of Impeccable Travel Service at November 30, 2010, the end of the current year, and its revenue and expenses for the year are listed below. The capital of the owner, Charly...
-
The debits and credits from two transactions are presented in the following supplier's (creditor's) account: NAME Carnation Inc. ADDRESS 5000 Grand Ave. Describe each transaction and the source of...
-
Selected transactions from the journal of Wong Consultants are presented below (amounts in thousands). Instructions a. Post the transactions to T-accounts. b. Prepare a trial balance at August 31,...
-
The T-accounts below summarize the ledger of Negrete Landscaping at the end of the first month of operations (amounts in ). Instructions a. Prepare the complete general journal (including...
-
Lennon Industries had the following transactions. 1. Borrowed 5,000 from the bank by signing a note. 2. Paid 3,900 cash for a computer. 3. Purchased 650 of supplies on account. Instructions a....
Study smarter with the SolutionInn App