Tyrone Sells His Personal-Use Car That Had Cost $15,000 for $10,000

question 55

Multiple Choice

Tyrone sells his personal-use car that had cost $15,000 for $10,000. Why is the loss realized on this transaction disallowed as a deduction?
I.Legislative Grace is lacking.
II.Personal losses are disallowed.
III.Business purpose is lacking.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Only statement III is correct.
• D)Statements I and II are correct.
• E)Statements I, II, and III are correct.

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Definitions:

Product Development

The process of designing, creating, and marketing new products or improving existing ones to satisfy customer needs and gain a competitive advantage.

Diversification

A risk management strategy that mixes a wide variety of investments within a portfolio.

Product Development

The creation of new products or the improvement of existing ones, involving idea generation, design, testing, and commercialization processes.

Market Penetration

An indicator of the total sales or use of a product or service relative to the maximum potential market for that product or service.