During the Current Year, Mrs

question 39

Multiple Choice

During the current year, Mrs.Mayhew received a used computer as a gift from her son for her personal use.The computer has a current fair market value of $350 and cost her son $850.He took $400 of depreciation deductions while it was used in his business.Mrs.Mayhew uses the computer for several years and then sells it for $200.What is the amount and type of gain or loss that Mrs.Mayhew recognizes on the sale?

• A)$0 gain or loss
• B)$150 Section 1245 loss
• C)$150 Section 1231 loss
• D)$250 Section 1231 loss