Question
In year 0, Longworth Partnership purchased a machine for $55,500 to use in its business. In year 3, Longworth sold the machine for $38,600. Between
In year 0, Longworth Partnership purchased a machine for $55,500 to use in its business. In year 3, Longworth sold the machine for $38,600. Between the date of the purchase and the date of the sale, Longworth depreciated the machine by $28,200. (Loss amounts should be indicated by a minus sign.)
a) What amount of gain (loss) is recognized on the sale? (Leave no answer blank. Enter zero if applicable.)
Decription amount
Total gain/lossrecognized ____________
Character of recognized gain/loss _____________
Ordinary gain/loss ____________
1231 gain/loss _____________
b) What amount of gain (loss) is recognized on the sale if the sale proceeds were increased to $66,750?
Decription amount
Total gain/lossrecognized ____________
Character of recognized gain/loss _____________
Ordinary gain/loss ____________
1231 gain/loss _____________
c) What amount of gain (loss) is recognized on the sale if the sale proceeds were decreased to $16,400? (Leave no answer blank. Enter zero if applicable.)
Decription amount
Total gain/lossrecognized ____________
Character of recognized gain/loss _____________
Ordinary gain/loss ____________
1231 gain/loss _____________
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started