A firm is selling an existing asset for $5,000. The asset, when purchased, cost $10,000, was being depreciated under MACRS using a five-year recovery period and has been depreciated for four full years
If the assumed tax rate is 40 percent on ordinary income and capital gains, the tax effect of this transaction is ________.
A) $0 tax liability
B) $1,320 tax liability
C) $1,160 tax liability
D) $2,000 tax benefit
B
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Narrative techniques are
A) inappropriate for professional communication. B) acceptable in business, but only for messages organized in the direct approach. C) an effective way to organize messages in a variety of business communication scenarios. D) a great way to help the audience grasp key points about sets of data.
Bay City Corporation received $21,000 for 12 months rent in advance. What entry is used to record this transaction?
A) Cash 21,000 Prepaid Rent 21,000 B) Rent Expense 21,000 Cash 21,000 C) Cash 21,000 Unearned Revenue 21,000 D) Unearned Revenue 21,000 Rent Revenue 21,000