Douglas Bought Office Furniture Two Years and Four Months Ago

question 61

Multiple Choice

Douglas bought office furniture two years and four months ago for $25,000 to use in his business and elected to expense all of it under Sec.179.Depreciation of $3,500 would have been taken under the MACRS rules.If Douglas converts the furniture to nonbusiness use today,Douglas must

• A)amend the prior two years tax returns.
• B)include $3,500 in gross income in year of conversion.
• C)include $21,500 in gross income in year of conversion.
• D)include $25,000 in gross income in year of conversion.

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Definitions:

Geometric Sequence

A series of numbers in which each subsequent term is derived by multiplying the term before it by a constant, non-zero figure referred to as the ratio.

Population

In statistics, population refers to the entire group of individuals or items that a study intends to investigate or draw conclusions from.

Rate

A ratio that measures how one quantity changes in relation to another.

Sum

The outcome of summing two or more numbers.