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Please help me with this AICPA U.S. TAXATION problems. CRU, Inc. has taxable income for the current year in the amount of $100,000 before considering
Please help me with this AICPA U.S. TAXATION problems.
CRU, Inc. has taxable income for the current year in the amount of $100,000 before considering the following additional information. Please treat each item below separately and indicate the total taxable income. Event Taxable Income 1. $60,000 was collected on a life insurance policy of which CRU, Inc. is the owner and beneficiary. The cash surrender value of the policy at that time was $20,000. The insured was a current officer of CRU, Inc. 2. Charitable contributions of $15,000 were made during the year. 3. CRU, Inc. sells property with a basis of $30,000 to its sole shareholder for $26,000. 4. A life insurance premium in the amount of $18,000 is paid on a policy covering the life of the president. As a result of this payment, the cash surrender value of the policy increased by $6,000. 5. Land with a basis of $40,000 is sold for $100,000 on the last day of the tax year. The $100,000 is received in installments; $50,000 this year, $30,000 next year, and $20,000 in the year after that. Please ignore all interest. 6. CRU, Inc. has a net operating loss (NOL) carryover from the prior year in the amount of $80,000. For each of the following situations, calculate the amount of gain or deductible loss that the taxpayer would report in the year of sale. Amount 7. John, who is single, purchased his principal residence on February 1, year 1 for $180,000. He sold it on November 1, year 3 for $150,000. Gain or Loss 8. Mark and Susan Smith, who are married filing jointly, sold their principal residence on December 1, year 5 for $550,000. Mark had purchased the home by himself as his principal residence on March 1, year 1 for $120,000. He married Susan on February 14, year 4 and she moved in that day. 9. Carl, who is head of household, purchased his principal residence on April 15, year 2 for $240,000. He lived in the home three years and then sold it for $480,000. During the three years, he had a home office and took depreciation totaling $2,000. 10. William and Rachel, who are married filing jointly, sold their home October 1, year 4 for $950,000 because of William's out-of-town job transfer. They had purchased it together as their principal residence October 1, year 3 for $600,000Step by Step Solution
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