Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

1. Which of the following is true of a realized gain? A)Difference between the amount realized and the adjusted basis. B)Difference between the amount realized

1.Which of the following is true of a realized gain?
A)Difference between the amount realized and the adjusted basis. B)Difference between the amount realized and the original basis C)The amount of proceeds you receive in exchange for an asset D) Not recognized

2.MC Terry purchased an ice-cream machine for $15,000; the seller is holding the note. Terry paid $1,500 for the required wiring and installation. Terry has deducted depreciation on the ice-cream machine for 2 years totaling $3,000. Terry owes $8,000 to the Seller. What is Terry's adjusted basis in the ice-cream machine?
A)$16,500 B) $12,000 C) $21,500 D) $13,500

3.Sue inherited 50 shs of Zoll Industry stock from her Uncle Dave. Dave purchased the stock in 1986 at $20/sh. The stock was worth $50/sh when Dave passed away. What is Sue's basis in the stock?
A)$1,000 B) $2,500 C) $3,500 D) No basis.

4.Which is true regarding the sale of a Personal Residence?
A) Exclusions are available up to $250,000 for single filers if requirements are met. B) The gain is deferred if you purchase a home of equal or greater value. C) It is treated as a like-kind exchange. D)The gain is tax-free for taxpayers 55 or older.

5.Which is true regarding a Like-Kind Exchange?

A) Equipment, Machinery, and Inventory are examples of qualified assets. B) Non like-kind property is considered "boot". C) Stock exchanged for stock in the same industry are qualified assets. D) Allows for the permanent exclusion of gain.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Government and Not-for-Profit Accounting Concepts and Practices

Authors: Michael H. Granof, Saleha B. Khumawala, Thad D. Calabrese, Daniel L. Smith

8th edition

1119495814, 1119495857, 1119495819, 9781119495819 , 978-1119495857

More Books

Students also viewed these Accounting questions