Emily,whose Tax Rate Is 28%,owns an Office Building Which She

question 22

Multiple Choice

Emily,whose tax rate is 28%,owns an office building which she purchased for $900,000 on March 18 of last year.The building is sold for $950,000 on February 20 of this year when the adjusted basis of the building was $876,000.The tax results to Emily are

• A)$74,000 1231 gain taxed at 15%.
• B)$74,000 ordinary income taxed at 28%.
• C)$24,000 1250 unrecaptured gain taxed at 25% and $50,000 1231 gain taxed at 15%.
• D)$24,000 1231 gain taxed at 15% and $50,000 ordinary income taxed at 28%.

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Definitions:

Current Demand

The existing desire or need for a product or service within a market at a specific point in time.

Complements

Goods or services that are used together, where an increase in the consumption of one leads to an increase in the consumption of the other.

Supply Curve

The Supply Curve is a graphical representation showing the relationship between the price of a good or service and the quantity of that good or service that suppliers are willing and able to provide, typically upward sloping.

Change In Supply

A shift in the quantity of a good that producers are willing and able to sell at various prices, due to factors other than the price of the good itself.