In 2023, Carrie sold a building used in her business for $640,000. The building originally...
50.1K
Verified Solution
Link Copied!
Question
Accounting
In 2023, Carrie sold a building used in her business for $640,000. The building originally cost $214,000 in 1979 and $200,000 of accelerated depreciation has been deducted. The straight-line depreciation would have been $175,000. The buyer paid $160,000 cash down in 2023 and agreed to pay $120,000 per year for 4 years plus 6% interest starting in 2024. Her taxable income in 2023 is $235,000, excluding the sale, and she is a single filer. She has no other taxable transactions in 2023.
REQUIREMENT 1: Calculate the installment sale gross profit percentage. (Round % to 2 decimal points)
REQUIREMENT 2: How much income (ignore interest income) related to the installment sale must Carrie report in 2023? What is her 2023 tax liability from this transaction?
REQUIREMENT 3: What is the amount and character of the gain Carrie must report in 2024 related to this installment sale?
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.