Alejandro Purchased a Building in 1985,which He Uses in His

question 11

Multiple Choice

Alejandro purchased a building in 1985,which he uses in his manufacturing business.Alejandro uses the ACRS statutory rates to determine the cost-recovery deduction for the building.Alejandro's original cost for the building is $500,000 and cost-recovery deductions allowed are $500,000.If the building is sold for $800,000,the tax results to Alejandro are

• A)$500,000 Sec.1245 ordinary income and $300,000 Sec.1231 gain.
• B)$800,000 Sec.1245 ordinary income.
• C)$500,000 Sec.1245 ordinary income and $300,000 Sec.1250 income.
• D)$800,000 Sec.1231 gain.

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Definitions:

Decision-Making Process

A systematic approach involving identification, analysis, and selection among various alternatives based on criteria to reach a final choice.

Situational Leadership Model

A leadership theory proposing that the most effective leaders adjust their style according to the maturity level of the people they are leading and the specifics of the task.

Leadership Styles

The various ways in which leaders exercise their authority, influence, and manage people, ranging from autocratic to democratic and transformational.

Situation

The set of circumstances or the context in which events occur, impacting the behavior and decisions of individuals or organizations.