Yelenis,whose Tax Rate Is 32%,sells One Sec $$\begin{array} {| l | l | l | } \hline 15 \% & 25 \% & 32 \% \\\hline \$ 20,000 & \$ 16,000 & \$ 0 \\\hline\end{array}$$

question 30

Multiple Choice

Yelenis,whose tax rate is 32%,sells one Sec.1231 asset this year,resulting in a $50,000 gain.Included in the $50,000 Sec.1231 gain is $30,000 of unrecaptured Sec.1250 gain.A review of Yelenis tax files for the past five years indicates one prior Sec.1231 sale which resulted in a $14,000 loss.The gain will be taxed as

• A) \[\begin{array} {| l | l | l | }
• \hline 15 \% & 25 \% & 32 \% \\
• \hline \$ 20,000 & \$ 16,000 & \$ 0 \\
• \hline
• \end{array}\]
• B) \[\begin{array} { | l | l | l | }
• \hline 15 \% & 25 \% & 32 \% \\
• \hline \$ 20,000 & \$ 16,000 & \$ 14,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} {| l | l | l | }
• \hline 15 \% & 25 \% & 32 \% \\
• \hline \$ 6,000 & \$ 30,000 & \$ 0 \\
• \hline
• \end{array}\]
• D) \[\begin{array} { | l | l | l | }
• \hline 15 \% & 25 \% & 32 \% \\
• \hline \$ 6,000 & \$ 30,000 & \$ 14,000 \\
• \hline
• \end{array}\]

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Definitions:

Ciliary Muscle

Smooth muscle in the ciliary body of the eye.

Retina

is the light-sensitive layer at the back of the eye that contains photoreceptor cells, which convert light into neural signals for visual recognition.

Ciliary Body

Structure continuous with the choroid layer at its anterior margin that contains smooth muscle cells; functions in accommodation.

Rods and Cones

Types of photoreceptor cells in the retina of the eye, with rods being responsible for vision at low light levels and cones for color vision and fine detail.