Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Need help with completing form 4797 with this information. Required information [The following information applies to the questions displayed below.] Moab Incorporated manufactures and distributes

image text in transcribed

image text in transcribed

image text in transcribedimage text in transcribed

Need help with completing form 4797 with this information.

Required information [The following information applies to the questions displayed below.] Moab Incorporated manufactures and distributes high-tech biking gadgets. It has decided to streamline some of its operations so that it will be able to be more productive and efficient. Because of this decision it has entered into several transactions during the year. a. Moab Incorporated sold a machine that it used to make computerized gadgets for $27,300 cash. It originally bought the machine for $19,200 three years ago and has taken $8,000 in depreciation. b. Moab Incorporated held stock in ABC Corporation, which had a value of $12,000 at the beginning of the year. That same stock had a value of $15,230 at the end of the year. c. Moab Incorporated sold some of its inventory for $7,000 cash. This inventory had a basis of $5,000. d. Moab Incorporated disposed of an office building with a fair market value of $75,000 for another office building with a fair market value of $55,000 and $20,000 in cash. It originally bought the office building seven years ago for $62,000 and has taken $15,000 in depreciation. e. Moab Incorporated sold some land held for investment for $28,000. It originally bought the land for $32,000 two years ago. f. Moab Incorporated sold another machine for a note payable in four annual installments of $12,000. The first payment was received in the current year. It originally bought the machine two years ago for $32,000 and has claimed $9,000 in depreciation expense against the machine. g. Moab Incorporated sold stock it held for eight years for $2,750. It originally purchased the stock for $2,100. h. Moab Incorporated sold another machine for $7,300. It originally purchased this machine six months ago for $9,000 and has claimed $830 in depreciation expense against the asset. Complete Moab Incorporated's Form 4797 for the year. W Determine the gain/loss realized and recognized in the current year for each of these events provided above. Also gain/loss recognized will be 1231, capital, or ordinary. (Do not round intermediate computations. Loss amounts minus sign.) Asset 9999995 1a 1b 1c 1d 1e 1f Realized Gain/(Loss) 1h Totals 1g + $ 16,100 $ 0 2,000 28,000 (4,000) 25,000 650 (870) 66,880 $ Recognized $1245 Ordinary 291 Ordinary Gain/(Loss) Income Income $ 16,100 $ 0 2,000 20,000 (4,000) 13,000 650 (870) 46,880 $ 8,000 $ 0 0 0 0 9,000 0 0 17,000 $ $1231 Gain/(Loss) 0 S 0 0 3,000 0 0 0 0 3,000 $ Ordinary Income/(Loss) 8,100 S 0 0 17,000 0 4,000 0 0 29,100 $ 0 0 2,000 0 0 0 0 Capital Gain/(Loss) $ (870) 1,130 $ 0 0 0 0 0 0 650 0 650 1231 Netting Process: 1231 gain 1231 loss Net 1231 gain Nonrecaptured 1231 losses Net 1231 gain Ordinary Income: 1245 recapture 291 recapture Ordinary income Ordinary loss Ordinary income from 1231 netting Total Capital Gains and Losses: Capital gain Capital loss Net capital gain S 69 S 69 69 $ $ $ (9 $ 60 $ 69 69 $ 69 $ $ 60 $ 60 $ 60 29,100 0 29,100 2,000 27,100 17,000 3,000 2,000 (870) 2,000 23,130 27,750 (4,000) 23,750

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

Principles Of Cost Accounting

Authors: Edward J. Vanderbeck

15th Edition

978-0840037039, 0840037031

More Books

Students also viewed these Accounting questions