Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

OMG is in a country which has a capital gains tax, conducted the following transactions: a . Purchased a building in February 2 0 1

OMG is in a country which has a capital gains tax, conducted the following transactions: a. Purchased a building in February 2018 for $26,000,000. In March 2019, the company spent $2,000,000 to install solar panels for electricity in the building. The building was sold for $28,500,000 in 2021. The annual maintenance cost was $500,000. The cost of advertising the sale of the building and the legal fees amounted to $1,500,000.
b. A motor vehicle was purchased for $5 million on January 1,2018. The vehicle was sold in 2021 for $4.5 million.
c. Bought an antique painting for $3.5 million in 2019. The painting was sold in 2021 for $10 million.
d. Purchased a government bond for $5,000,000 in 2018 and sold it for $7,500,000 in 2021.
The company is entitled to an Annual Exemption of $500,000.
Capital losses as of 1 January 2021 were $1,500,000. Calculate the capital gains tax in 2021, assuming a capital gains tax of 15%.

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

Trends In Financial Decision Making

Authors: Cees Van Dam

1978 Edition

9020706926, 978-9020706925

More Books

Students also viewed these Accounting questions