This Year Pranav Had the Gains and Losses Noted Below

question 78

Multiple Choice

This year Pranav had the gains and losses noted below on property,plant and equipment used in his business.Each asset had been held longer than one year. $$\begin{array} {| l | r| } \hline\text { Gain due to insurance reimbursement for fire } & \$ 17,000 \\\hline \text { Loss due to condemnation } & ( 12,000 ) \\\hline \text { Gain on sale of Sec. 1231 property } & 21,000 \\\hline\end{array}$$ A review of Pranav's reporting of Sec.1231 transactions for the prior five years indicates a net Sec.1231 loss of $14,000 three years ago and a net Sec.1231 gain of $8,000 last year (before the five-year lookback) .Pranav will recognize

• A) \[\begin{array} {| r | r | }
• \hline \text { Ordinary gain (loss) } & \text { LTCG(L) } \\
• \hline \$ ( 6,000 ) & \$ 26,000\\\hline
• \end{array}\]
• B) \[\begin{array} {| r | r | }
• \hline \text { Ordinary gain (loss) } & \text { LTCG(L) } \\
• \hline \$ ( 18,000 ) & \$ 38,000 \\
• \hline
• \end{array}\]
• C) \[\begin{array} { |r | r |}
• \hline \text { Ordinary gain (loss) } & \text { LTCG(L) } \\
• \hline\$ 0 & \$ 18,000\\\hline
• \end{array}\]
• D) \[\begin{array} {| r | r| }
• \hline \text { Ordinary gain (loss) } & \text { LTCG(L) } \\
• \hline \$ 6,00 \mathrm {~d} & \$ 20,00 \mathrm { l }\\\hline
• \end{array}\]

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Definitions:

Colon

A part of the large intestine that absorbs water and salts from food and plays a crucial role in the digestive system.

Mastication

The process of chewing food in preparation for swallowing and digestion.

Hepatic Flexure

The hepatic flexure is the bend in the colon near the liver, marking the transition from the ascending colon to the transverse colon.

Colon

The largest part of the large intestine, responsible for absorbing water and electrolytes from digested foods and forming stool.