Business, 27.05.2020 15:57 ilovesummertime207

Heather owns a two-story building. The building is used 40% for business use and 60% for personal use. During 2015, a fire caused major damage to the building and its contents. Heather purchased the building for $800,000 and has taken depreciation of $100,000 on the business portion. At the time of the fire, the building had a fair market value of $900,000. Immediately after the fire, the fair market value was $200,000. The insurance recovery on the building was $600,000. The contents of the building were insured for any loss at fair market value. The business assets had an adjusted basis of $220,000 and a fair market value of $175,000. These assets were totally destroyed. The personal use assets had an adjusted basis of $50,000 and a fair market value of $65,000. These assets were also totally destroyed.

If an amount is zero, enter "0".

Determine the business and personal gain or loss in regard to the building and its contents.

Determine the business and personal gain or loss in regard to the building and its contents.

Total Business
Portion Personal
Portion
Cost of building $800,000 $320,000 $480,000
Less: Depreciation (100,000) $(100,000) $0
Adjusted basis $700,000 $220,000 $480,000
Decline in FMV $700,000 $ ?
$ ?

Business
Portion Personal
Portion
Loss on building (lesser of basis or decline in FMV) $220,000 $420,000
Less: Insurance reimbursement $240,000 360,000
Gain on business portion $20,000
Loss on personal portion $60,000
Loss on business contents $220,000
Less: Insurance recovery $175,000
Loss on business contents $45,000
Loss on personal contents $ ?
Less: Insurance recovery $ ?
Gain on personal contents $ ?
Heather's AGI is $100,000 before considering the effects of the fire. Determine her itemized deduction and AGI after considering the effects of the fire.

Adjusted Gross Income
AGI before effects of accident $100,000
Business portion of building and contents:
Net loss on building and contents ?
Personal casualty gain 15,000
Personal casualty loss to extent of gain 15,000
Net personal casualty gain 0
AGI $75,000
Itemized Deduction
Balance of personal casualty loss $ ?
Less: Per event floor $ ?
Less: 10%-of-AGI floor $7500
Itemized deduction $37,400

Answers: 2

Show answers

Another question on Business

Business, 22.06.2019 09:30

Darlene has a balance of 3980 on a credit card with an apr of 22.8% paying off her balance and which of these lengths of time will result in her paying the least amount of interest?

Answers: 2

Answer

Business, 22.06.2019 11:40

In each of the following, what happens to the unemployment rate? does the unemployment rate give an accurate impression of what’s happening in the labor market? a.esther lost her job and begins looking for a new one.b.sam, a steelworker who has been out of work since his mill closed last year, becomes discouraged and gives up looking for work.c.dan, the sole earner in his family of 5, just lost his $90,000 job as a research scientist. immediately, he takes a part-time job at starbucks until he can find another job in his field.

Answers: 2

Answer

Business, 22.06.2019 21:10

The blumer company entered into the following transactions during 2012: 1. the company was started with $22,000 of common stock issued to investors for cash. 2. on july 1, the company purchased land that cost $15,500 cash. 3. there were $700 of supplies purchased on account. 4. sales on account amounted to $9,500. 5. cash collections of receivables were $5,500. 6. on october 1, 2012, the company paid $3,600 in advance for a 12-month insurance policy that became effective on october 1. 7. supplies on hand as of december 31, 2010 amounted to $225. the amount of cash flow from investing activities would be:

Answers: 2

Answer

Business, 22.06.2019 23:30

Which statement best describes the two reactions? abcl, + h2 → 2hci2h + h = he + inreaction a involves a greater change, and reaction b involves a change in element identity.reaction b involves a greater change and a change in element identityreaction a involves a greater change and a change in element identity.reaction b involves a greater change, and reaction a involves a change in element identity.

Answers: 1

Answer

You know the right answer?

Heather owns a two-story building. The building is used 40% for business use and 60% for personal us...

Questions