Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question

Transcribed Image Text:Lena is a sole proprietor. In April of this year, she sold equipment purchased four years ago for $42,000 with an adjusted basis of $25,200
for $27,720. Later in the year, Lena sold another piece of equipment purchased two years ago with an adjusted basis of $12,600 for
$8,190.
What are the tax consequences of these tax transactions?
Lena has an ordinary gain
Lena has a § 1231 loss
of $
✔ of $
X from the sale of the first equipment.
X from the sale of the second equipment.
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