User Account

All Pages

What is the nature of this gain

Assignment Help Accounting Basics
Reference no: EM132108451

Question - The client depends on you, the CPA, to provide journal entries for activity in fixed assets. While discussing fixed assets, the client divulges that he got a great deal to upgrade his laser dermatology equipment. Ultimately, you find out that $569,888 of new equipment was purchased and placed in service on 6/18/2014. Furthermore, and much after the fact, you discover that old medical equipment was sold to an unrelated party for $75,000 cash. The original cost of the equipment was $300,000 and it was fully depreciated (no Sec. 179). The cash was deposited in one of the shareholders personal accounts.

a. Provide a journal entry to calculate the gain on sale and adjust the fixed asset and accumulated depreciation accounts.

b. What is the nature of this gain?

c. Could the Dr. have structured this sale in a different way to avoid taxable income?

Reference no: EM132108451

Questions Cloud

What are the guidelines for recording pensions : What are the guidelines for recording pensions? Why is pension accounting challenging? Have there been abuses associated with this area
Deciding on the firm distribution strategy in several mark : The sales manager for Smith Exports is deciding on the firm's distribution strategy in several markets.
Examine the balance between calming external stakeholders : Examine the balance between calming external stakeholders and the ethical considerations of providing all the information that is required by the SEC
Track flight prices on most airlines : Track Flight Prices On most airlines, flights open up for sale 331 days in advance. That is the earliest you can book a flight, about 11 months in advance.
What is the nature of this gain : The client depends on you, the CPA, to provide journal entries for activity in fixed assets. What is the nature of this gain
What is the realized gain and the recognized gain : Depreciation of $7,500 had been taken on the old machine. What is the realized gain and the recognized gain, and how will any recognized gain be treated
What are you looking forward to learning more about career : Looking back over the course objectives for this course, what are you looking forward to learning more about throughout your education and career?
Maintaining profitability will help stay ahead of profit : Maintaining profitability will help stay ahead of profit revenue. This is most important because this will help seize control.
Develop a strategic plan for the same organization : Building on Assignments 1 and 2, continue to develop a strategic plan for the same organization (Note: Refer to the environmental analysis that you completed.

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +91-977-207-8620

Phone: +91-977-207-8620

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd