90.2K

Verified Solution

Link Copied!

Equipment	MACRS Year Property	Cost	Accumulated Depreciation	Sales Price
Luxury Car	5 Year Property	$36,000	$12,000	$20,000
Computer	5 Year Property	$1,200	$1,200	$200
Furniture	7 Year Property	$25,000	$20,000	$10,000

1. What will be the tax treatment as follows for the sale of the Luxury Car
   1. Calculate the Realized Gain or Loss (5pts):

2. What will be the character and amount of the Recognized gain? (10 pts)

Character= Ordinary Income

Recognized Gain= $5,000

Luxury Car	Code Section	Character	Amount
	1231
	1245
	1250

2. What will be the tax treatment as follows for the sale of the Computer?
   1. Calculate the Realized Gain or Loss (5 pts):

2. What will be the character and amount of the Recognized gain? (10 pts)

Computer	Code Section	Character	Amount
	1231
	1245
	1250

3. What will be the tax treatment as follows for the sale of the Furniture
   1. Calculate the Realized Gain or Loss (5 pts):

2. What will be the character and amount of the Recognized gain? (10 pts)

Furniture	Code Section	Character	Amount
	1231
	1245
	1250

Answer & Explanation Solved by verified expert

See Answer