User Account

All Pages

How much gain did barry recognize on sale of his annuity

Assignment Help Financial Management
Reference no: EM13887683

Eighteen months ago, Barry Shelton won a $2 million Maryland state lottery jackpot and chose to receive it as $120,000 annual annuity for the rest of his life. This year his brothers persuaded him to sell the annuity to a financial institution for $1.79 million and invest the sales proceeds in a new family business. How much gain did Barry recognize on sale of his annuity, and is it ordinary income or long term capital gain?

Reference no: EM13887683

Questions Cloud

Which sectors have increased their value added share : Consider some of the items you regularly purchase and how they have been affected by ICT. Which sectors/?rms have increased their value added share and which have lost out?
Prepare a condensed income statement for violet bick : Analysis discloses that these data include the operating results of the hotel chain. Prepare a condensed income statement for Violet Bick Corporation.
Consider a hotelling line of length : Question 3: [5 points] Consider a Hotelling line of length 1 with firms currently located at 0.29 and 0.75. Prices for all firms are fixed at p. You are advising a third firm about where to locate on the line. What is the best location you can sugges..
How have it developments affected your productivity : How would a technological development that boosted output but produced a higher depreciation rate affect output and capital?
How much gain did barry recognize on sale of his annuity : Eighteen months ago, Barry Shelton won a $2 million Maryland state lottery jackpot and chose to receive it as $120,000 annual annuity for the rest of his life. This year his brothers persuaded him to sell the annuity to a financial institution for $1..
What minimalist painter made large scale portraits : What minimalist painter made large scale portraits of individuals using a grid format?
Ron is looking forward to purchase a good car : Ron is looking forward to purchase a good car for himself. After a research he had found that Toyota Camry, Honda Accord, Ford Fusion fit into his budget and that he likes its specifications
Compute the affected ratio as of december : Compute the affected ratio (1) as of December 31, 2013, and (2) as of December 31, 2014, after giving effect to the situation. Net income for 2014 was $50,000.
Mr and mrs lukert own a sole proprietorship : Mr. and Mrs. Lukert own a sole proprietorship and have no other source of income. This year, they paid $11,674 Massachusetts income tax, all of which is attributable to their business profit. Can they deduct their state income tax as a business expen..

Reviews

Write a Review

Financial Management Questions & Answers

  Real rate of return on that investment will be

Investors are purchasing 1-year US treasury bills (IOUs from Uncle Sam that will come due in one year) that have a nominal expected rate of return of about 2%. If inflation over the next 12 months is 5% then the real rate of return on that investment..

  Before-tax and after-tax rates-corporate bonds

An investor, Terry Noirs, is in the 40% tax bracket and has been contemplating investing in corporate bonds. After a recent stay at the Eiffel Payne Hospital, a not-for-profit hospital, he learned that they will be issuing tax-exempt bonds for a majo..

  A movie studio sells the latest movie on dvd to

a movie studio sells the latest movie on dvd to blockbuster at 10 per dvd. the marginal production cost for the movie

  What is the value on cash flows

What is the value on 1/1/13 of the following cash flows?

  Take positions in financial futures to reduce

_________ take positions in financial futures to reduce their exposure to future movements in interest rates or stock prices; ________ commonly take the opposite position and thus serve as counterparties on many transactions.

  Investment opportunity-What is the NPV of the project

Lakonishok Equipment has an investment opportunity in Europe. The project costs €19 million and is expected to produce cash flows of €3.6 million in Year 1, €4.1 million in Year 2, and €5.1 million in Year 3.

  As part of its international expansion program acme a us

as part of its international expansion program acme a u.s. multinational enterprise mne is currently in the planning

  Cash distribution according to tax purposes and IRS Code

You are currently working in a mid-size certified public accounting firm. Your client is Bob Jones. Bob, age 60 and single, has recently retired from IBM. He has $690,000 available in his 401k ad he is thinking of using that money to open a used car ..

  The dividend yield on the preferred stock

The CCC Venture has issued convertible preferred stock to its venture investors. Each share of preferred stock is convertible into 0.80 share of common stock and pays an annual cash dividend of $0.25. If each share of preferred stock has a market val..

  Chemical compound used in manufacture of wide range

Carlyle chemicals is evaluating a new chemical compound used in the manufacture of a wide range of consumer products. The firm is concerned that inflation in the cost of raw materials will have an adverse effect on the projects cash flow. what recomm..

  Monthly transactions-adjustments and financial statements

Moonlight Bay Inn is incorporated on January 2, 2010, by its three owners, each of whom contributes $20,000 in cash in exchange for shares of stock in the business. In addition to the sale of stock, the following transactions are entered into during ..

  Order return probability

Calculate the expected return on an asset that has the following probable returns:

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: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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