Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please help! Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $65,000, and it has claimed

Please help!image text in transcribedimage text in transcribed

Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $65,000, and it has claimed $23,000 of depreciation expense against the building. (Loss amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Round your final answers to the nearest whole dollar amount.) Required: a. Assuming that Hauswirth receives $50,000 in cash for the warehouse, compute the amount and character of Hauswirths recognized gain or loss on the sale. b. Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $50,000, compute Hauswirth's realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land. C. Assuming that Hauswirth receives $20,000 in cash in year 0 and a $50,000 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1. Complete this question by entering your answers in the tabs below. Req a Req b Reqc Assuming that Hauswirth receives $20,000 in cash in year 0 and $50,000 note receivable that is payable in year 1, compute the amount and character of Hauswirth's gain or loss in year 0 and in year 1. (Round "Gross Profit Percentage" to 2 decimal places.) Amount Character $ 70,000 $ $ Description Sales price Original Basis Accumulated Depreciation Adjusted Basis Gain (Loss) Realized Depreciation Recapture Gain Eligible for Installment Reporting Gross Profit Percentage $1231 gain recognized in year $1231 gain recognized in year 1 65,000 (23,000) 42,000 28,000 $ $ Ordinary Income % Section 1231 gain Section 1231 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

Management And Cost Accounting

Authors: Mike Tayles, Colin Drury

11th Edition

147377361X, 978-1473773615

More Books

Students also viewed these Accounting questions