Carr's Used Cars, Inc. sold one asset this year -- equipment for $70,000. The original cost...
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Carr's Used Cars, Inc. sold one asset this year -- equipment for $70,000. The original cost of the equipment was $50,000, tax basis was $20,000, and book depreciation was $45,000. What is the tax effect of the sale? OA) $30,000 ordinary income and $20,000 1231 net gain treated as capital gain B) $50,000 capital gain C) 45,000 ordinary income and $5,000 capital gain D) $20,000 ordinary income and $30,000 capital gain Carr's Used Cars, Inc. sold one asset this year -- equipment for $70,000. The original cost of the equipment was $50,000, tax basis was $20,000, and book depreciation was $45,000. What is the tax effect of the sale? OA) $30,000 ordinary income and $20,000 1231 net gain treated as capital gain B) $50,000 capital gain C) 45,000 ordinary income and $5,000 capital gain D) $20,000 ordinary income and $30,000 capital gain
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