Solution-Calculate Agnes realized and recognized gain

Calculate Agnes realized and recognized gain

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Reference no: EM132670649

Problem - Rod Clooney purchases Agnes Mitchell's sole proprietorship for $990,000 on August 15, 2019. The assets of the business are:

Asset	Agnes's Adjusted Basis	FMV
Accounts receivable	$ 70,000	$ 70,000
Inventory	90,000	100,000
Equipment	150,000	160,000
Furniture and fixtures	95,000	130,000
Building	190,000	250,000
Land	25,000	75,000
Total	$620,000	$785,000

Required -

a. Calculate Agnes's realized and recognized gain.

b. Determine Rod's basis for each of the assets.

c. Write a letter to Rod informing him of the tax consequences of the purchase. His address is 300 Riverview Drive, Delaware, OH 43015.

Reference no: EM132670649

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Calculate Agnes realized and recognized gain

Reference no: EM132670649

Reference no: EM132670649

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