What is the present value of the installment payments

Assignment Help Accounting Basics
Reference no: EM132672104

Problem - Jasmine owned rental real estate that she sold to her tenant in an installment sale. Jasmine acquired the property in 2007 for $400,000; took $178,000 of depreciation on it; and sold it for $210,000, receiving $25,000 immediately and the balance (plus interest at a market rate) in equal payments of $18,500 for 10 years.

Required -

a. What is the nature of the recognized gain or loss from this transaction?

b. Assuming that the interest rate on the installment contract is 5%, what is the present value of the installment payments?

Reference no: EM132672104

Questions Cloud

What is the nature of disposition gain or loss : On August 10, 2017, Jasper purchased business equipment for $40,000. What is the nature of disposition gain or loss? Where is it reported on the 2018 Form 4797
What are the pros and cons of applying positive psychology : What are the pros and cons of applying positive psychology in the workplace and why? Can the performance be improved on an individual, a team or an organization
What tax forms related to their property transactions : In addition to their Form 1040, what tax forms related to their property transactions would the couple include in their income tax return
Describe the three major paradigms in io psychology : Discuss which one of the three paradigms has made the most significant contribution to the field in industrial/organizational psychology. Justify the claims and
What is the present value of the installment payments : Assuming that the interest rate on the installment contract is 5%, what is the present value of the installment payments
What are the three levels of personality at organizations : Which level is most useful to the field of I/O Psychology? Discuss this level of personality. Provide an example of this level of personality in the workplace.
Describe the relationship of emotional intelligence : Define Emotional Intelligence. Describe the relationship of emotional intelligence to individual performance in the workplace? In detail please I do not quite g
What was the tax status of this property for Tan : Tan Corporation purchased depreciable tangible personal property for $100,000 in 2017. What was the tax status of this property for Tan
Describe the ways to avoid the ethical issues : Write a 1,000 - 1,250-word paper discussing codes of practice and ethical issues that must be considered when using psychological assessments.

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.

  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!

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