A Corporation Is Selling an Existing Asset for $1,700

question 112

Multiple Choice

A corporation is selling an existing asset for $1,700. The asset, when purchased, cost $10,000, was being depreciated under MACRS using a five-year recovery period, and has been depreciated for four full years. If the assumed tax rate is 40 percent on ordinary income and capital gains, the tax effect of this transaction is ________.

• A) $0 tax liability
• B) $840 tax liability
• C) $3,160 tax liability
• D) $3,160 tax benefit

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Definitions:

Identity Gap

The discrepancy or conflict between an individual's perceived self and how others see them or how they are expected to behave in certain roles or contexts.

Acceptance of Change

Relates to the willingness or ability of individuals or organizations to adapt to new conditions, innovations, or transformations.

Organizational Change

The process by which organizations transform their structure, strategies, operational methods, or culture to adapt to changes in the external or internal environment.

Negative Job Attitudes

Feelings of dissatisfaction, disengagement, or negativity toward one's job, which can undermine performance and lead to turnover.