CORPORATE CAPITAL GAINS. Northam Manufacturing, Inc., had the following capital asset transactions during 19x1:

a)

b)

c)

d)

Sold land that cost $187,000 for $179,000 cash. The land had been purchased 5 months earlier for eventual use as a new factory site and was sold as a result of a change in long-term plans.

Sold an old factory facility for $2,400,000. Northam paid $10,000,000 for the facility 12 years ago and had accumulated depreciation for tax purposes of $7,200,000 since that time.

Sold a small office building to an accounting and consulting firm for $210,000 cash.

The building cost Northam $150,000 several years ago, and has accumulated depreciation for tax purposes of $27,000.

Sold unneeded land for $610,000 cash to a country club for expansion of its golf course. The land was acquired 3 months ago as part of the purchase of a factory facility. The separate cost of the land was $500,000.

REQUIRED:

1.

2.

Determine the short-term or long-term capital gain or loss from each of these transactions.

Assuming that these transactions are Northam’s only capital asset dispositions during 19x1 and that ordinary income from other sources totals $972,000, calculate taxable income for 19x1.