Albert's Sole Proprietorship Owns the Following Assets

question 80

Multiple Choice

Albert's sole proprietorship owns the following assets:

* Potential § 1245 recapture of $30,000.
** Straight-line depreciation was used.
Albert sells his sole proprietorship for $470,000.Calculate Albert's recognized gain or loss and classify it as capital or ordinary.

• A)$200,000 ordinary income.
• B)$200,000 capital gain.
• C)$100,000 ordinary income and $100,000 capital gain.
• D)$90,000 ordinary income and $110,000 capital gain.
• E)None of the above.

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