Beige Corporation, a C Corporation, Purchases a Warehouse on August

question 12

Essay

Beige Corporation, a C corporation, purchases a warehouse on August 1, 1998, for $1 million. Straight-line depreciation is taken in the amount of $411,750 before the property is sold on June 11, 2014, for $1.2 million. What is the amount and character of the gain recognized by Beige on the sale of the realty?
a. Ordinary income of $0 and § 1231 gain of $611,750.
b. Ordinary income of $411,750 and § 1231 gain of $200,000.
c. Ordinary income of $82,350 and § 1231 gain of $529,400.
d. Ordinary income of $117,650 and § 1231 gain of $494,100.
e. None of the above.

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Definitions:

Autonomic

Relating to the autonomic nervous system, which controls involuntary bodily functions, including heart rate, digestion, and respiratory rate.

Meninges

The three protective membranes that cover the brain and spinal cord, including the dura mater, arachnoid mater, and pia mater.

Glia

Non-neuronal cells in the central nervous system that support, protect, and nourish neurons.

Ventricles

Hollow structures within the brain that produce and store cerebrospinal fluid, or chambers of the heart that pump blood.