On november 4 2012 blue company acquired an asset 275-year


On November 4, 2012, Blue Company acquired an asset (27.5-year residential real property) for $200,000 for use in its business. In 2012 and 2013, respectively, Blue took $642 and $5,128 of cost recovery. These amounts were incorrect; Blue applied the wrong percentages (i.e., those for 39-year rather than 27.5-year assets). Blue should have taken $910 and $7,272 cost recovery in 2012 and 2013, respectively. On January 1, 2014, the asset was sold for $180,000.

a.   The adjusted basis of the asset at the end of 2013 is $.

b.   The cost recovery deduction for 2014 is $.

 

c.   The Select loss gain Item 3 on the sale of the asset in 2014 is $.

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Financial Accounting: On november 4 2012 blue company acquired an asset 275-year
Reference No:- TGS01075086

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