{[ promptMessage ]}

Bookmark it

{[ promptMessage ]}

Chapter 8 HW Solutions

Chapter 8 HW Solutions - 16 Like-Kind Exchange Solution...

Info icon This preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
16. Like-Kind Exchange Solution: $400,000 received - $230,000 basis = $170,000 gain realized but deferred. $400,000 - $170,000 deferred gain = $230,000 basis in land received. 17. Like-Kind Exchange Solution: a. $320,000 received - $350,000 basis = $30,000 loss realized but deferred. $320,000 + $30,000 deferred loss = $350,000 basis of apartment building. b. Because Shawn must defer the loss, he would have been better off if he had sold the factory building and then purchased the apartment building with the proceeds. In that way, he could recognize the $30,000 loss and reduce his taxes. 19. Like-Kind Exchange Solution: a. $108,000 - $16,000 cash - $69,000 basis = $23,000 realized gain. None of the $23,000 gain is recognized. b. $23,000 gain is deferred. Taylor gave boot; only the receipt of boot triggers gain. c. The basis of the large machine is $85,000 ($108,000 - $23,000 deferred gain). (Alternative basis calculation: $69,000 basis of machines surrendered + $16,000 boot given + 0 gain recognized – 0 boot received = $85,000.) 22. Like-Kind Exchange Solution: a. Realized and recognized gain/loss calculations Lab Kennels Wolman Developers $900,000 -350,000 +200,000 FMV of property received Mtge assumed by Lab Kennel
Image of page 1

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern