[LO 8.2 & 8.3] Juno Corporation had ordinary taxable incomeof $167,000 in the current year before consideration of any of thefollowing property transactions. It sold two blocks of stock heldfor investment. One yielded a short-term capital gain of $8,000 andthe other a long-term capital loss of $14,000. In addition, Junosold four pieces of machinery for $30,000. It purchased themachines three years ago for $80,000 and claimed $35,000 ofdepreciation deductions. Juno also sold a building for $400,000that it had purchased fifteen years ago for $390,000. Thedepreciation deductions up to the date of sale for the buildingwere $108,000.
- Determine the amount and character of each gain or loss fromthe property transactions and Juno Corporation’s taxable income forthe current year.
- How would your answers to (a) change if Juno were a singleindividual with no dependents and $14,000 of itemized deductionsinstead of a corporation?
- How would your answers to (b) change if Juno has $550,000 ofordinary taxable income?
