If a Depreciable Asset Is Sold

question 159

Multiple Choice

If a depreciable asset is sold:

• A)there is no tax consequence.
• B)the sale price minus the book value is added to the firm's income and is taxed at the firm's long term capital gain tax rate.
• C)the sale price is added to the firm's income and is taxed at the firm's marginal tax rate.
• D)the sale price minus the book value is added to the firm's income and is taxed at the firm's marginal tax rate.
• E)the sale price minus the book value is added to the firm's income and is taxed at the firm's average tax rate.