Calculate the tax payable on the proposed sale

Assignment Help Accounting Basics
Reference no: EM131627619

Question: Walt Hubble is contemplating selling rental property that originally cost $200,000. He believes that it has appreciated in value at an annual rate of 6% over its 4-year holding period. He will have to pay a commission equal to 5% of the sale price to sell the property. Currently, the property has a book value of $137,000. The mortgage balance outstanding at the time of sale currently is $155,000. Walt will have to pay a 15% tax on any capital gains and a 25% tax on recaptured depreciation.

a. Calculate the tax payable on the proposed sale.

b. Calculate the after-tax net proceeds associated with the proposed sale, CFR.

Reference no: EM131627619

Questions Cloud

Promotional activity in marketing is to inform-persuade : The main goal of any promotional activity in marketing is to inform, persuade, and/or remind the consumer of the firms good
Find the banker percentage return : Find the banker's percentage return (in terms of yen) if XYZ trades for $24 and the exchange rate is $.01/Y when the position is closed.
Benchmarking-reverse engineering and specification : Research 3 of the following topics related to product design and service design: Benchmarking, Reverse engineering, Specification.
Explain the possible penalties for violations : An overview of the major laws relating to fraud & abuse in healthcare, and the possible penalties for violations
Calculate the tax payable on the proposed sale : Walt Hubble is contemplating selling rental property that originally cost $200,000. He believes that it has appreciated in value at an annual rate of 6%.
Probability of bankruptcy by what percentage : If Ralston has debt due of $75 million in one year, the CEO's decision will increase the probability of bankruptcy by what percentage?
Analyzing the global market environment : Economic and business environment analysis - Political, Legal and Regulatory environment analysis
Demanding retail world extends a small supplier : How does a small supplier cope as the big guys try to squeeze out every inefficiency in the supply chain, while demanding greater quality,
Utlize the concept of samples : Utlize the concept of samples and population to describe how PRESIDENTIAL ELECTION IS UNLIKE AN EXIT POLL OF ELECTORate.

Reviews

Write a Review

Accounting Basics Questions & Answers

  List any invetervals on which the function is increasing

f(x) = 12x3 - 117x2 - 432x +2 List any invetervals on which the function is increasing and decreasing. Identify the time intervals where A(x) is decreasing.

  Assuming the effective rate of interst is 12 and using the

assume that you have won the publishers clearing house sweepsteaks. when you are contacted about your winnings you are

  Holtrop corporation has received a request for a special

holtrop corporation has received a request for a special order of 9900 units of product z74 for 47.40 each. the normal

  Review the case of bad debts account of g gardham

On 1st January, 1962 the Provision for Bad Debts Account in the books of G. Gardham showed a credit balance of £230. During the following twelve months.

  On february 1 2013 can do it trucks sold a diesel rig to ma

on february 1 2013 can do it trucks sold a diesel rig to ma transports for 250000 receiving a 50000 down payment and a

  Aqua system engineering provides consulting services to

aqua system engineering provides consulting services to city water authourity a recent income statment releaved

  What are the variables of a regression analysis

What are the variables of a regression analysis, and how do they affect the results of the analysis? What challenge does this pose to getting reliable results?

  During the month of march wang company sold merchandise on

during the month of march wang company sold merchandise on account for 9100. the merchandise had cost wang 4900. which

  Darmow corporation purchased a new machine

On August 2, 2010, Darmow Corporation purchased a new machine on a deferred payment basis.

  Case study of cherokee company

Cherokee Company acquired a machine on January 1, 2009, that cost $2,700 and had an estimated residual value of $200. Complete the following schedule using the three methods of depreciation: A. straight-line, B. units-of-production, C. 150% declin..

  Are warehousing costs considered product cost or period cost

A company purchases airplanes for sale to others. However, until they are sold, the company charters and services the planes. What is the proper way to report these airplanes in the company's financial statements?

  What needs improvement and how to improve

Summary assessment of results (what did company do right/wrong, what needs improvement and how to improve)

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!

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