Jenna,who Is Single,sold Her Principal Residence on December 1,2015,and Excluded

question 117

Multiple Choice

Jenna,who is single,sold her principal residence on December 1,2015,and excluded the $150,000 gain because she met the ownership and usage requirements under Sec.121.Jenna purchased another residence in Pensacola on January 1,2016 that she occupied until July 1,2016 when she receives a new job offer from an employer in Miami.She sells the Pensacola residence on October 1,2016 and realizes a gain of $40,000.Jenna may exclude what amount of the gain from the sale on October 1,2016?

• A)$0
• B)$10,000
• C)$20,000
• D)$40,000

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Definitions:

Accumulated Depreciation

The total amount of a tangible asset's cost that has been expensed over time through depreciation.

Original Cost

The initial monetary value of an asset or investment, reflecting the purchase price or production cost before adjustments like depreciation or amortization.

Gain on Sale

Profit realized from the sale of assets or investments when the selling price exceeds the book value.

Net Income

The total profit of a company after all expenses, including taxes and operating costs, have been subtracted from total revenues.