A Barn Held More Than One Year and Used in a Business

question 58

Multiple Choice

A barn held more than one year and used in a business is destroyed in a tornado. The barn originally cost $356,000 and was fully depreciated using straight-line depreciation. The barn was insured for its $543,000 replacement cost minus a deductible of $1,000. Which of the statements below is correct concerning these facts?

• A) The barn was a long-term personal use asset.
• B) There is a casualty loss from disposition of the barn.
• C) The recognized gain from disposition of the barn is $186,000.
• D) The recognized gain from disposition of the barn is subject to special netting rules.
• E)C and d.

Grasp the legal concepts and standards applied to nonprofit governance, including preventing conflicts of interest and ensuring ethical financial practices.

Understand the models and frameworks proposed for effective governance in nonprofits.

Recognize the types of boards and their selection processes in the nonprofit sector.

Understand the fiduciary responsibilities of nonprofit boards relating to asset management and compliance with legal and ethical standards.

---

Definitions:

Customary Fee

A charge or payment that is considered typical or usual within a particular industry, market, or legal context based on long-standing practices.

Apparent Authority

A situation in which a reasonable person would understand that an agent had the authority to act, even if the agent didn't have such authority.

Express Agency

An agency relationship formed by explicit oral or written agreement between the agent and the principal.

Implied Agency

A situation where an agency relationship is inferred from the actions of the parties rather than an explicit agreement.