Determine the amount and character of each gain

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Question - Juno Corporation had ordinary taxable income of $127,000 in the current year before consideration of any of the following property transactions. It sold two blocks of stock held for investment. One yielded a short-term capital gain of $8,000 and the other a long-term capital loss of $14,000. In addition, Juno sold four pieces of machinery for $30,000. It purchased the machines three years ago for $80,000 and claimed $35,000 of depreciation deductions. Juno also sold a building for $400,000 that it had purchased fifteen years ago for $390,000. The depreciation deductions up to the date of sale for the building were $108.000.

Required -

a. Determine the amount and character of each gain or loss from the property transactions and Juno Corporation's taxable income for the current year.

b. How would your answers to (a) change if Juno were a single individual with no dependents and $10,000 of itemized deductions instead of a corporation?

c. How would your answers to (b) change if Juno has $425,000 of ordinary taxable income?

Reference no: EM132620758

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