Question 1

Lump-sum purchases of land and a building are allocated on the basis of the relative fair market values of the individual assets acquired.

Accepted Answer

A) True 
 B)False

Question 2

​Nontaxable stock dividends result in no change to the total basis of the old and new stock,but the basis per share decreases.

Accepted Answer

A) True 
 B)False

Question 3

Joyce's office building was destroyed in a fire (adjusted basis of $350,000;fair market value of $400,000) .Of the insurance proceeds of $360,000 she receives,Joyce uses $310,000 to purchase additional inventory and invests the remaining $50,000 in short-term certificates of deposit.She received only $360,000 because of a co-insurance clause in her insurance policy.What is Joyce's recognized gain or loss?

Accepted Answer

A)  $0
B)  $10,000 loss
C)  $10,000 gain
D)  $40,000 gain
E)  None of the aboveF) D) and E)
G) None of the above

Exam 14: Property Transactions Determination of Gain and Loss and Basic Considerations

Lump-sum purchases of land and a building are allocated on the basis of the relative fair market values of the individual assets acquired.

Correct Answer
verified

Nontaxable stock dividends result in no change to the total basis of the old and new stock,but the basis per share decreases.

Correct Answer
verified

Correct Answer
verified

Exam 14: Property Transactions Determination of Gain and Loss and Basic Considerations

Lump-sum purchases of land and a building are allocated on the basis of the relative fair market values of the individual assets acquired.

Correct AnswerverifiedShow Answer

​Nontaxable stock dividends result in no change to the total basis of the old and new stock,but the basis per share decreases.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
verified

Nontaxable stock dividends result in no change to the total basis of the old and new stock,but the basis per share decreases.

Correct Answer
verified

Correct Answer
verified