Dana Purchases an Automobile for Personal Use for $27,000

question 74

Multiple Choice

Dana purchases an automobile for personal use for $27,000. After using it for three years, Dana converts the automobile to business use when the fair market value is $19,000. After a few months of business use, Dana sells the automobile for $18,000. What is the amount of gain or loss recognized on the sale of the automobile?

• A)No gain or loss
• B)$1,000 loss
• C)$8,000 loss
• D)$9,000 loss
• E)$8,000 gain

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Definitions:

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