During the current year, a business sells equipment for $330,000. The equipment cost $300,000 when purchased and placed in service two years ago and $90,000 of depreciation deductions were allowed. The results of the sale are A) ordinary income of $120,000. B) Sec. 1231 gain of $120,000. C) ordinary income of $90,000 and LTCL of $30,000. D) ordinary income of $90,000 and Sec. 1231 gain of $30,000.

Individual Income Taxes
43rd Edition
ISBN:9780357109731
Author:Hoffman
Publisher:Hoffman
Chapter12: Alternative Minimum Tax
Section: Chapter Questions
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During the current year, a business sells equipment for
$330,000. The equipment cost $300,000 when
purchased and placed in service two years ago and
$90,000 of depreciation deductions were allowed. The
results of the sale are
A) ordinary income of $120,000.
B) Sec. 1231 gain of $120,000.
C) ordinary income of $90,000 and LTCL of $30,000.
D) ordinary income of $90,000 and Sec. 1231 gain of
$30,000.
Transcribed Image Text:During the current year, a business sells equipment for $330,000. The equipment cost $300,000 when purchased and placed in service two years ago and $90,000 of depreciation deductions were allowed. The results of the sale are A) ordinary income of $120,000. B) Sec. 1231 gain of $120,000. C) ordinary income of $90,000 and LTCL of $30,000. D) ordinary income of $90,000 and Sec. 1231 gain of $30,000.
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