Describing depreciated property and appreciated property

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Q1) You wish $100,000 after eight years to start a business. Presently you have $26,000 which may be invested to earn 7% annually. How much extra money must you set aside each year if these funds also earn 7% to meet your goal of $100,000 at end of eight years? By how much would your reply vary if you invested extra funds at commencement of each year instead of at end of each year?

Q2) Terminally ill Jasmine doesn’t expect to live longer and provides property to 3 of her nieces. She creates a gift of depreciated property (adjusted basis exceeds fair market value) to Marsha, appreciated property (fair market value exceeds adjusted basis) to Jan, and leaves appreciated property to Cindy in her will. From the income tax perspective, which is her favourite niece?

Reference no: EM1310645

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