Reference no: EM131801487

Assignemnt

In year 0, Longworth Partnership purchased a machine for $53,500 to use in its business. In year 3, Longworth sold the machine for $40,700. Between the date of the purchase and the date of the sale, Longworth depreciated the machine by $22,500.

a. What amount of gain (loss) is recognized on the sale?

Total Gain/(Loss) Recognized:

Character of Recognized Gain/(Loss):

Ordinary Gain/(Loss):

1231 Gain/(Loss):

b. What amount of gain (loss) is recognized on the sale if the sale proceeds were increased to $66,500?

Total Gain/(Loss) Recognized:

Character of Recognized Gain/(Loss):

Ordinary Gain/(Loss):

1231 Gain/(Loss):

c. What amount of gain (loss) is recognized on the sale if the sale proceeds were decreased to $23,600?

Total Gain/(Loss) Recognized:

Character of Recognized Gain/(Loss):

Ordinary Gain/(Loss):

1231 Gain/(Loss):