T11F-Chp-09-2-HW-Prb

T11F-Chp-09-2-HW-Prb -...

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5bb250854c2b7734618e01ff0482d1fa44e3854b.doc. Page 1 of 3 Name: Home work-Chapter 9 1 Barbara earns a salary from Big Corporation of $100,000 per year. On 1-1-2011, she invested $30,000 to become a 25% partner in a partnership that owns rental property. In 2011, the partnership had revenue of $90,000 and expenses of $50,000. No salary or guaranteed payment was made to any partner. Barbara did withdraw $4,000 from the partnership in 2011. What is Barbara’s basis in her partnership interest at the end of 2011, after taking into account all information above? a . $30,000 b $40,000 c. $34,000 d. $36,000 2 On 1-2-11, a company bought a warehouse and land, paying cash of $100,000 and giving a mortgage of $400,000. The company paid back taxes of $5,000 that had accrued for 2010, and will pay $5,000 for taxes that will be due for 2011. What is the total basis of the warehouse and land? a. $500,000 b. $505,000 c. $510,000 3 David pays $35,000 cash and issues a mortgage note for $95,000 to purchase land. He pays $750 to his attorney for reviewing the purchase agreement. David's initial basis in the land is a. $ - 0 - b. $ 35,000 c. $ 35,750 d. $130,000 e. $130,750 4 Carol is the business manager for Greenville Auto Mart. She buys a new car from the dealership for $30,000. The basis of the car to the dealership was $25,000, and the fair market value is $42,000. Greenville Auto Mart has a sales policy of posting the price of vehicles and not negotiating sales discounts with customers. What is Carol's basis in the new car? a. $ - 0 - b. $25,000 c. $42,000 d. $30,000 e. $37,000 5 Harold purchases land and a building by paying cash of $35,000, and assuming the seller's $82,000 mortgage. In addition, Harold pays $3,000 of legal fees related to the purchase. For property tax purposes, the land is valued at $17,000 and the building at $34,000. Harold's basis in the building is a. $ 17,000 b. $ 34,000 c. $ 40,000 d. $ 80,000 e. $120,000 6 Bill and Dorothy purchase a new residence on April 30, 2011. Bill and Dorothy pay the full amount of
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T11F-Chp-09-2-HW-Prb -...

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