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Capital gains taxes: Perkins Manufacturing

Capital gains taxes: Perkins Manufacturing is considering the sale of two non-depreciable assets, X and Y. Asset X was purchased for $1,900 and will be sold today for $2,460. Asset Y was purchased for $40,000 and will be sold today for $49,600. The firm is subject to a 37% tax rate on capital gains.

a. Calculate the amount of capital gain, if any, realized on each of the assets.

Capital gain on Asset X =

Capital gain on Asset Y =

b. Calculate the tax on the sale of each asset

Tax on the sale X =
Tax on the sale Y =

See attached document.

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Solution Summary

The solution provides step by step method for the calculation of capital gain and tax on sale of assets at Perkins Manufacturing.

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