Renata Corporation purchased equipment in 2013 for $180,000 and has taken $83,000 of regular MACRS depreciation. Renata Corporation sells the equipment in 2015 for $110,000. What is the amount and character of Renata’s gain or loss?

Question

2.24K viewsOctober 21, 2016

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Darshita 6.14K October 21, 2016 0 Comments

Renata Corporation purchased equipment in 2013 for $180,000 and has
taken $83,000 of regular MACRS depreciation. Renata Corporation sells the
equipment in 2015 for $110,000. What is the amount and character of Renata’s gain
or loss?

1 Answer

score 0 · Answer 1 · 2016-10-21T07:20:55+00:00

Answer : Gain on sale if Equipment = $13,000 It is Short term Capital Gain

Working notes for the above answer is as under

Renata Corporation	Amount in $
purchased equipment in 2013	180,000
regular MACRS depreciation taken	83000
WDV as per MACRS method	97,000
Less:
Sell the equipment for 110,000	110,000
gain on sale of equipment	13,000

1 Answer

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