Five years ago, Firm SJ purchased land for $$122,000$ with $$10,000$ of its own funds and $$112,000$ borrowed from a commercial bank. The bank holds a recourse mortgage on the land. For each of the following independent transactions, compute SJ$$s positive or negative cash flow. Assume that SJ is solvent, any recognized loss is fully deductible, and SJ$$s marginal tax rate is $21$ percent.

Required:

SJ sells the land for $$55,000$ cash and the buyer$$s assumption of the $$80,000$ principal balance of the mortgage.

SJ sells the land for $$135,000$ cash and pays off the $$80,000$ principal balance of the mortgage.

SJ sells the land for $$93,000$ cash and pays off the $$80,000$ principal balance of the mortgage.

SJ defaults on the $$80,000$ mortgage. The bank forecloses and sells the land at public auction for $$66,200.$ The bank notifies SJ that it will not pursue collection of the $$13,800$ remaining debt.

SJ defaults on the $$80,000$ mortgage. The bank forecloses and sells the land at public auction for $$66,200.$ The bank requires SJ to pay off the $$13,800$ remaining debt.

Note: For all requirements, Negative amounts should be indicated by a minus sign.