Question

Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years...

Hauswirth Corporation sold (or exchanged) a warehouse in year 0. Hauswirth bought the warehouse several years ago for $65,500 and it has claimed $25,400 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:

  1. a. Assuming that Hauswirth receives $56,700 in cash for the warehouse, compute the amount and character of Hauswirth’s recognized gain or loss on the sale.
    recognized
    character of recognized gain/ loss   
    ordinary gain/ loss
    1231 gain / loss
    1. b. Assuming that Hauswirth exchanges the warehouse in a like-kind exchange for some land with a fair market value of $56,700, compute Hauswirth’s realized gain or loss, recognized gain or loss, deferred gain or loss, and basis in the new land.
      gain realized   
      gain recognized
      deferred gain
      adjusted basis in new property
  2. c. Assuming that Hauswirth receives $39,500 in cash in year 0 and a $61,000 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.)
description amount character
amount realized
original basis
accumulated depreciation
adjusted basis
gain realized
depreciation recapture ordinary income
gain eligible for installment reporting
gross profit percentage
installment gain in year 0 section 1231 gain
installment gain in year 1 section 1231 gain
0 0
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Answer #1

Solution Given that several year ago Hauswirth bought the ware house for $65, 500 And it has claimed $25,400 expense against. : = 56,700 - 16.00 40100] 16,600 gain realized gain recognized defferred gain adjusted basis $ 16,600 in new property $40,description amount character amount realized 100,500 Original basis 65,500 accumulated depreciation 25,400 adjusted basis 40,

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