Sumner Sold Equipment That It Uses in Its Business for $30,000

question 41

Multiple Choice

Sumner sold equipment that it uses in its business for $30,000. Sumner bought the equipment a few years ago for $80,000 and has claimed $40,000 of depreciation expense. Assuming that this is Sumner's only disposition during the year, what is the amount and character of Sumner's gain or loss?

• A)$10,000 §1231 loss.
• B)$10,000 §1245 loss.
• C)$50,000 ordinary loss.
• D)$10,000 capital loss.
• E)None of the choices are correct.

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Definitions:

Acetylcholinesterase

An enzyme that breaks down the neurotransmitter acetylcholine, terminating its action at the neural synapse.

Action Potentials

Rapid and temporary changes in the electrical membrane potential of a cell, allowing for the transmission of signals along neurons.

Spastic Contractions

Spastic contractions refer to involuntary muscle spasms that are continuous and caused by various neurological or muscular disorders.

Neuromuscular Junction

The synapse or connection point between a motor neuron and a skeletal muscle fiber, facilitating muscle contraction.