Gupta Company Made the Following Sales of Capital Assets This

question 72

Multiple Choice

Gupta Company made the following sales of capital assets this year. $$\begin{array} { c c c } & \text { Tax Basis } & \text { Sale Price } \\\text { Asset 1 } & \$ 60,000 & \$ 47,800 \\\text { Asset 2 } & 112,500 & 116,000 \\\text { Asset } 3 & 13,000 & 22,400\end{array}$$ What is the effect of the three sales on Gupta's taxable income?

• A) $700 increase
• B) $12,900 increase
• C) No effect
• D) None of the above

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Definitions:

Small Business Investment Companies (SBICs)

Privately owned and managed investment funds, licensed and regulated by the SBA, that provide capital to small businesses.

Unit Investment Trusts (UITs)

A type of investment company offering fixed portfolios of securities, which are held until a specific maturity date, to investors.

Joint Ventures

Business arrangements in which two or more parties agree to pool their resources for the purpose of accomplishing a specific task or project.

Business Incubators

Organizations or initiatives designed to support startups and young businesses by providing resources, mentorship, and sometimes capital or office space to foster growth and success.