Dorothy Operates a Pet Store as a Sole Proprietorship

question 94

Essay

Dorothy operates a pet store as a sole proprietorship.During the year she sells the business to Florian for $200,000.The assets sold and the allocation of the purchase price are as follows:
Dorothy acquired the building in 1997 for $100,000 of which $20,000 was allocated to the land.She paid $40,000 for the equipment in the same year.What are the tax consequences of the liquidation for Dorothy?

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Definitions:

Online Course

An educational course offered entirely over the internet, allowing students to learn remotely.

Sample Size

The quantity of subjects or units selected from a population to participate in a research study, determining the study's ability to detect a significant effect.

T Procedure

A statistical method typically used to test hypotheses when the sample size is small and the population variance is unknown, involving the t-distribution.

Approximately Normal

Describes a distribution that closely follows a normal distribution, often used as an assumption in statistical tests.