Melody Works in Her Home Using a Computer She Purchased

question 27

Multiple Choice

Melody works in her home using a computer she purchased two years ago for $2,500.The total adjusted basis for the computer is now $1,000.Her husband and children used the computer 20 percent of the time to play computer games and for personal correspondence.She sells the computer for $1,200.How much and what kind of gain does Melody recognize?

• A)$200 capital gain
• B)$200 Section 1245 recapture
• C)$200 Section 1231gain
• D)$460 Section 1245 recapture

---

Definitions:

Reported Dreams

The recounting or description of dreams by individuals upon waking, often used in psychological research and therapy to understand unconscious desires or concerns.

Death Instincts

A concept in psychoanalytic theory referring to an unconscious drive towards decay, destruction, or death.

Personality

A set of emotional, behavioral, and cognitive tendencies that make up an individual's character.

Pleasure Principle

The principle by which the id functions to avoid pain and maximize pleasure.