Buffey Operates a Delivery Service

question 40

Multiple Choice

Buffey operates a delivery service.She purchased a van in 2015 for $25,000,and she sold it in 2017 for $15,000.Buffey did not deduct any depreciation on the van from 2015 through 2017,although total allowable depreciation on the van would have been $17,000.What is the amount of Buffey 's recognized gain or loss on the sale of the van?

• A)$10,000 loss
• B)$7,000 gain
• C)$8,000 gain
• D)$15,000 gain
• E)$17,000 gain

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Definitions:

Deadweight Loss

The loss of economic efficiency that can occur when the equilibrium for a good or service is not achieved or is not achievable.

Excise Tax

A tax levied on the sale of specific goods and services, such as tobacco, alcohol, and gasoline.

Demand Curve

A graphical representation showing the relationship between the price of a good and the quantity demanded.

Luxury Yachts

High-end, luxurious boats equipped with sophisticated amenities, designed for comfort and leisure.