H Purchases a Farm with an Abandoned Farmhouse on It

question 11

Multiple Choice

H purchases a farm with an abandoned farmhouse on it.In the attic, he finds a mattress stuffed with $20,000 in old silver certificate bills.The tax consequences of this find are

• A)Taxable income of $20,000 to the former owner of the mattress
• B)Taxable income of $20,000 to H
• C)No tax consequences at this time
• D)Capital gain of $20,000

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Definitions:

Exclusive Right

A legal entitlement granting someone the sole authority to engage in a certain activity or use a specific property.

Profit

The financial gain obtained when the total revenues generated from selling goods or services exceed the total costs and expenses to produce them.

Exclusive Right

Exclusive Right is a legal entitlement that grants the holder the sole privilege to perform, use, or sell a particular service, product, or piece of intellectual property.

Marginal Revenue

The additional revenue that a company receives from selling one more unit of a product or service.