21. Father, age 50, sells an office building worth $500,000 (assume all of the property is depreciable) to his son in exchange for a private annuity. The father has a basis of $200,000 and he receives an unsecured promise to pay him $60,000 per year for the rest of his life. The interest rate for annuities is 10% and the father's life expectancy is 25 years. (a) (a) What is the composition of each payment

Pear co.’s income statement for the year ended december 31, as prepared by pear’s controller, reported income before taxes of $125,000. the auditor questioned the following amounts that had been included in income before taxes: equity in earnings of cinn co. $ 40,000 dividends received from cinn 8,000 adjustments to profits of prior years for arithmetical errors in depreciation (35,000) pear owns 40% of cinn’s common stock, and no acquisition differentials are relevant. pear’s december 31 income statement should report income before taxes of