Question

George owned a restaurant. He purchased the building for 200,000, and had taken 150,000 of depreciation on the building. It was destroyed by a fire on 04/17/18. it was insured for 300,000 and the insurance Company paid George 280,000 on 12/06/18. The fire was considered a natural disaster area.

If George wants to avoid recognition of the gain, what is the minimum amount he must pay for a new restaurant, and if he purchases a new restaurant for 250,000 on 04/03/19 what is his recognized gain?

Answer 1

固- × Book1 Excel HOME INSERT PAGE LAYOUTFORMULAS DATA REVIEW VIEW ACROBAT KPMG S Cut Ee Copy Σ AutoSum -A Wrap Tot Calibri 恒桓茁Merge & Center. $. % , 留1: conditional Format as Cell Formatting TableStyles Paste Insert Delete Format Sort & Find& Filter Select B 1 u . 田·ク· · Clear Format Painter Font Cells Editing Alignment WDV of Building Recognised gain Amount Particulars Insurance Claim received Less: WDV of Building write off Recognised gain Minimum amount George value Less: Depreciation Closing WDV to avoid r nition of Gain Answer: Since, george purchase new restaurant for 250000 which is greater n minimum value. Hence, his recognised gain is 0 10 12 13 15 17 20 21 Sheet1 Sheet2 囲回匹 + 100% 06-23 PM O Type here to search 04/19/19

Formula View:

Book1 Excel HOME INSERT PAGE LAYOUTFORMULAS DATA REVIEW VIEW ACROBAT KPMG S Cut Ee Copy Wap TetGeneral ーtE t-H Merge & Center $ . % , 留-28 Σ AutoSum -A 10 A Format Painter Bru· B- 2. Paste Conditional Format as Cell Insert Delete Format Formatting TableStyles Sort & Find& Filter Select Clear Font Cells Editing Alignment fr G9 Answer: Since, george purchase new restaurant for 250000 which is greater than minimum value. Hence, his recognised gain is 0. WDV of Buildin Recognised gain Particulars Insurance Claim received Less: WDV of Building write off Recognised gain value Less: Depreciation Closing WDV SUM(D4:D5) SUM(H4:H5) Minimum amount George must pay to avoid r nition of Gain H6 Answer: Since, george purchase new restaurant for 250000 which is greater than minimum value. Hence, his recognised gain is 0 10 12 13 14 15 17 20 21 Sheet1 Sheet2 囲回匹 + 100% 06-24 PM O Type here to search 04/19/19

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