Please answer all the questions.

==========================

==========================

==========================

Gleim 9-13 Basis deprec sale property [1] Mr. Black purchased his first house in March for $41 ,000. In addition. Mr. Black incurred thefollowing expenses: $360 for3 years of casualty insurance$820 for new driveway $250 for interior painting $1 45 for title insurance $400 for exterior painting $405 for new gutters What is Mr. Black's basis in this house? A. $42,225B. $42,370C. $42,730D. $43,020 [2] Mr. Ft received bonds as a gift from his mother. At the time of the gift, the bonds had a fairmarket value of $5,000 and an adjusted basis to Fi's mother of $6,000. No gift tax was paid. Sixmonths later, Ft sold the bonds for $0,500. What was F-i's basis in the bonds for computing gain? A. $0 B. $5,0000. $0,000D. $6,500 [3] The basis in property inherited from a decedent may be determined as follows: A. The decedent's basis plus any inheritance tax paid on the increased value. B. The lair market value at the date of death. C. The fair market value at an alternate valuation date. D. The fair market value at the date of death or the fair market value at an alternative valuationdate. [4] Mrs. N inherited property from a decedent where an estate tax return was not required to be?led. The decedent's adjusted basis in the property at the time ofdeath was $75,000. A local realestate agent, qualified as an appraiser, placed a valuation of$100,000 on the property at thedate of death. The appraised value for state inheritance tax purposes was $90,000. What is Mrs.N's basis in the property? A. $100,000B. $90,000C. $75,000D. $0 5 A fire in Mr . White's residence resulted in a loss of $22 000 . Mr . White recovered only$ 16 000 from his insurance company . By what amount must Mr . White reduce his basis beforeconsidering any reinvestment of the insurance proceeds in repairs on the house ?A. $6 000B. $16000C. 80D. $22 0006 For sales and exchanges , the holding period for determining long-term capital gains andlosses is more thanA . 6 monthsB. 9 monthsC. 12 monthsD. 18 months71 In Year 1 , Alice Smith bought a diamond necklace for her own use at a cost of $10 000In Year 5 when the fair market value was $12 , 000 Alice gave this necklace to her daughterJulie . No gift tax was due Julie's holding period for this giftA . Starts in Year 5B . Starts in Year 1C . Depends on whether the necklace is sold by Julie at a gain or at a lossD . Is irrelevant because Julie received the necklace for no consideration of money or money'sworth8 / Which of the following assets are depreciable or amortizable for federal income taxpurposes ?1 . Land2 . Personal residence3 . Rental residence4 . Inventory5 . Acquired goodwill6 . Business automobileA . 3. 5 . and 6B . 1 . 2 . and 3C. 1 and 4D. 3 4 , and 6 91 Mrs . Howser converted her personal residence ( originally acquired in 1981 ) to rental propertyin the current year At the time of the change in use , the property had an adjusted basis of$45 , 000 , of which $5 000 was for the land and $ 40 000 for the house . The fair market value atthe time of the change was $50 000 of which $1 1 000 was for land and $39 , 000 for the houseWhat is Mrs . Howser's basis for determining depreciation ?A . $39. 000B. 840 000C. $ 45, 000D. 850 00010 With10 ) With regard to depreciation computations made under the general MACRS method , the halfyear convention provides thatA . One half of the first year's depreciation is allowed in the year in which the property is plain service , regardless of when the property is placed in service during the year , and a half - year'sdepreciation is allowed for the year in which the property is disposed ofB . The deduction will be based on the number of months the property was in service , so thatone - half month 's depreciation is allowed for the month in which the property is placed in serviceand for the month in which it is disposed ofC . Depreciation will be allowed in the first year of acquisition of the property only if the propertyis placed in service no later than June 30 for calendar - year corporationD. Depreciation will be allowed in the last year of the property's economic life only if the properis disposed of after June 30 of the year of disposition for calendar - year corporations11 Residential rental property that was placed in service during the current year using MACRSis depreciated over how many years , using which depreciation method and convention ?A . 15 years , 150% - declining balance method , half - year conventionB . 27 5 years , straight line method , mid - month conventionC . 39 years , straight- line method , mid - month conventionD. 40 years , 200% - declining - balance method , half - year convention121 Joe Hall owns a limousine for use in his personal service business of transportingpassengers to airports . The limousine's adjusted basis is $40 000 . In addition , Hall owns hispersonal residence and furnishings , that together cost him $280 000 Hall's capital assetsamount toA . $320 00B . $280 000C. $40 000D. SO131 Which of the following is a capital asset ?A . Inventory held primarily for sale to customersB . Accounts receivableC . A computer system used by the taxpayer in a personal accounting businessD . Land held as an investment 141 On July 1 , Year 1 , Lila Perl paid $90 000 for 450 shares of Janis Corporation common stockLila received a nontaxable stock dividend of 50 new common shares in November of Year 4 . OnDecember 20 , Year 5 , Lila sold the 50 new shares for $1 1 000 . How much should Lila report inher Year 5 return as long-term capital gainA . SB . $1 000C. $2000D. $1 1 0015 In January of Year 1 , Kirk Kelly bought 100 shares of a listed stock for $8 000 . In March ofYear 2 , when the fair market value was $6 000 Kirk gave this stock to his cousin , Clara No gifttax was paid Clara sold this stock in June of Year 3 for $7 000 . How much is Clara's reportablegain or loss in Year 3 on the sale of this stock ?A . 8B. $1,000 losC. $1 000 gainD. $7 000 gain16 In December of the current year , Emily sold an antique rug for $4 100 . She bought the rug5 years ago for $1 100 . What is her taxable gain and at what maximum rate will it be taxedA . $3 000 long-term capital gain , taxed at a regular rateB . $3 000 long-term capital gain , taxed at 28% rateC . $1, 500 long-term capital gain , taxed at a regular rateD . $1 500 long-term capital gain , taxed at 28% rate171 The maximum tax rate on net capital gains for individuals for 2018 isA. 20%B. 28C. 250 %D. 150%18 Billy Luker made several stock sales during 2018 . Determine the overall result of thefollowing transactionsDatePurchasedCost Date Sold Sales Price1- 1-18$ 4,0006 - 2 - 18 8 6 0007- 6- 1710.0007- 7-1814.0007- 6-1720.0007 - 6- 1870004 - 3 - 176 - 2-18A . $2000 net short -term capital gainB . $3, 000 net long-term capital gain and $1 000 net short -term capital lossC . $2000 net long-term capital gaiD. $4 ,000 net long-term capital gain and $2000 net short-term capital loss [19] Alan Kupper had the following transactions during 2018: t Gain oi $7,000 on sale or common stock purchased on January 15, 2017, and sold onApril 15,2018. t Gain oi $5.000 on sale or common stock purchased on October 15, 2017, and sold onMarch 25, 2018. t Receipt ot a $1 0,000 installment payment on an installment contract created in 2010, whenKupper sold for $1 00,000 (exclusive oi 6% interest on installments) land acquired in 2000 for$20.000. The contract provides for 10 equal annual principal payments of $10,000beginning on July 1,2010, and ending on July 1,2019. Determine the result ot the transactions. A. $15,000 long-term capital gain.B. $8,000 long-term capital gain.C. $7,500 long-term capital gain.D. $6,000 long-term capital gain. [20] Capital losses incurred by a married couple tiling ajoint return A. Will be allowed only to the extent at capital gains. B. Will be allowed to the extent ol capital gains, plus up to $3,000 of ordinary income.0. May be carried forward up to a maximum of 5 years. D. Are not allowable losses. [21] Bob and Gloria sold securities during the current year. The sales resulted in a capital loss of $7,000. They had no other capital transactions. Their taxable income was $26,000. How muchcan they deduct on theirjoint return? A. $7,000B. $3,000C. $4,000o. $0 [22] Larry sold stock with a cost basis of$10,500 to his son for $8,500. Larry cannot deduct the$2,000 loss. His son sold the same stock to an unrelated party tor $15,000, realizing a gain.What is his son's reportable gain? A. $6,500B. $4,500C. $2,000D. No gain. [23] Judy Tower, age 34, is single. Her adjusted gross income for 2018 is $1 T9500. Included inthis total is $5,000 of net long-term capital gains from assets held over 12 months. Judy claimsthe standard deduction. Judy's income tax liability for 2018 is A. $32,090B. $33,6900. $34,4400. $35,290 [24] Mary Brown purchased an apartment building 6 years ago for$275,000. The building wasdepreciated using the straight-line method. The building was sold for$285,000 when the assetbasis net of accumulated depreciation was $215,000. On her current-year tax return, Brownshould report A. Section 1231 gain o1$70,000. B. Ordinary income of$?0,000. 0. Section 1231 gain of $60,000 and ordinary income of $10,000.D. Section 1231 gain ot$10,000 and ordinary income of $60,000. [25] Sonny Shapiro was the sole proprietor oi a high-volume drug store that he owned tor 15 years before he sold itto Dale Dmg Stores, Inc., in the current year. Besides the $900,000selling price for the store's tangible assets and goodwill, Sonny received a lump sum of $30,000in the current year for his agreement not to operate a competing enterprise within 10 miles of thestore's location for a period 016 years. The $30,000 will be taxed to Sonny as A. $30,000 ordinary income in the current year.B. $30,000 short-term capital gain in the currentyear.0. $30,000 long-term capital gain in the current year.D. Ordinary income of $5,000 a year for 6 years. [26] Christina and Anne are equal partners in the capital and pro?ts of Agee & Nolan but areotherwise unrelated. The following information pertains to 300 shares of Mast Corporation stockpurchased by Anne 12 years ago and sold this year to Agee & Nolan. Basis (cost) $9,000Sales price (equal to fair market value) $4,000 The amount of long-term capital loss that Anne recognized in the current year on the sale of thisstock was A. $5,000B. $3,0000. $2,500D. so [27] In a like-kind exchange of an investment asset for a similar asset that will also be held as aninvestment, no taxable gain or loss will be recognized on the transaction if both assets consist of A. Convertible debentures. B. Convertible preferred stock. 0. Partnership interests. D. Rental real estate located in di?erent states. [28] All of the following statements regarding tax-tree, like-kind exchanges are true except A. The property must be held for productive use in a trade or business, or it must be investmentproperty. 8. The property must be tangible property. C. The exchange ot real property for similar real property may qualify for a tax-free exchange.D. It you pay money in addition to giving up like property in a like-kind exchange, you may havea taxable gain or deductible loss. [29] On October1 of the current year, Donald Anderson exchanged an apartment building,having an adjusted basis of $375,000 and subjectto a mortgage of$100,000, for$25,000 cashand another apartment building with a fair market value of $550,000 and subject to a mortgage of$125,000. The property transfers were made subject to the outstanding mortgages. What amountof gain should Anderson recognize in his tax return for the year? A. $0 B. $25,0000. $125,000D. $175,000 [30] Bennet Hanovetr purchased a tract 01 land tor $20,000 in Year 1 when he heard that a newhighway was going to be constructed through the property and that the land would soon be worth$200,000. Highway engineers surveyed the property and indicated that he would probably get$1 25000. The highway project was abandoned in Year 3, and the value of the land fell to$15,000. Hanover can claim a loss in Year 3 of A. $0 B. $5,000C. $160,000D. $180,000 [31] Which of the following statements about the frequency with which the $500,000 exclusion ofgain that is available on the sale of a principal residence (Sec. 121) may be used is true? A. There is no limit on the use of the exclusion. B. The exclusion may be used once peryear. C. The exclusion may be used once every 2 years.D. The exclusion may he used once in a lifetime. [32] Mr. and Mrs. Smith sold their principal residence for $750,000. They had lived in their homefor 20 years. and it had an adjusted basis of $210,000. The Smiths have decided not to purchasea new home and will instead rent a condominium 0n the beach. What amount ofgain must theyrecognize on this transaction? A. $0 B. $40,0000. $540,0000. $750,000 [33] Wynn, a 60-year old single individual, sold his personal residence for $450,000. Wynn hadowned his residence. which had a basis of $250,000, tor 6 years. Within 8 months 01 the sale,Wynn purchased a new residence for $400,000. What is Wynn's recognized gain from the sale 0this personal residence? A. $0 B. $500000. $75,000D. $200,000