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Comprehensive Problem $11-73($LO $11-1,$ LO $11-2,$ LO $11-3,$ LO $11-4,$ LO $11-5,$ LO $11-6)($Static$)$

$[$The following information applies to the questions displayed below.$]$

WAR $($We Are Rich$)$ has been in business since $1990.$ WAR is an accrual$-$method sole proprietorship that deals in the

manufacturing and wholesaling of various types of golf equipment. Hack & Hack CPAs has filed accurate tax returns for

WAR$9$;s owner since WAR opened its doors. The managing partner of Hack & Hack $($Jack$)$ has gotten along very well with

the owner of WAR$-$Mr$.$ Someday Woods $($single$).$ However, in early $2023,$ Jack Hack and Someday Woods played a round

of golf, and Jack, for the first time ever, beat Mr$.$ Woods. Mr$.$ Woods was so upset that he fired Hack & Hack and has hired

you to compute his $2023$ taxable income. Mr$.$ Woods was able to provide you with the following information from prior tax

returns. The taxable income numbers reflect the results from all of Mr$.$ Woods's activities except for the items separately

stated. You will need to consider how to handle the separately stated items for tax purposes. Also, note that the $2018-$

$2022$ numbers do not reflect capital loss carryovers.

In $2023,$ Mr$.$ Woods had taxable income in the amount of $$480,000$ before considering the following events and

transactions that transpired in $2023$:

a$.$ On January $1,2023,$ WAR purchased a plot of land for $$100,000$ with the intention of creating a driving range where

patrons could test their new golf equipment. WAR never got around to building the driving range; instead, WAR sold the

land on October $1,2023,$ for $$40,000.$

b$.$ On August $17,2023,$ WAR sold its golf testing machine, "Iron Byron," and replaced it with a new machine, "Iron Tiger."

"Iron Byron" was purchased and installed for a total cost of $$22,000$ on February $5,2019.$ At the time of sale, "Iron

Byron" had an adjusted tax basis of $$4,000.$ WAR sold "Iron Byron" for $$25,000.$

c$.$ In the months October through December $2023,$ WAR sold various assets to come up with the funds necessary to

invest in WAR's latest and greatest invention$-$the three$-$dimple golf ball. Data on these assets are provided below:

d$.$ Finally, on May $7,2023,$ WAR decided to sell the building where it tested its plutonium shaft and lignite head drivers.

WAR had purchased the building on January $5,2011,$ for $$190,000($ $$170,000$ for the building, $$20,000$ for the land$).$ At

the time of the sale, the accumulated depreciation on the building was $$50,000.$ WAR sold the building $($with the land$)$

for $$300,000.$ The fair market value of the land at the time of sale was $$45,000.$

Note: Do not round intermediate computations. Round your final answers to the nearest whole dollar amount. Loss

amounts should be indicated by a minus sign.

Comprehensive Problem $11-73$ Part $1($Static$)$

Required:

a$1.$ Compute Mr$.$ Woods's taxable income after taking into account the transactions described above.

a$2.$ Compute Mr$.$ Woods's taxable income. Compute Mr$.$ Woods's taxable income after taking into account the transactions described above.

Complete this question by entering your answers in the tabs below.

Required A$1$

Required A$2$

Compute Mr$.$ Woods's taxable income.