In the current year, Tim sells Section 1245 property for $28,000 that he had purchased 6 years

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In the current year, Tim sells Section 1245 property for $28,000 that he had purchased 6 years ago. Tim has claimed $7,000 in depreciation on the property and originally purchased it for $20,000. How much of the gain is taxable as ordinary income?

a. $7,000

b. $18,000

c. $13,000

d. $8,000

e. None of these choices are correct.

Related Book For answer-question

Financial Reporting and Analysis

ISBN: 978-0078025679

6th edition

Authors: Flawrence Revsine, Daniel Collins, Bruce, Mittelstaedt, Leon

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Posted Date: Aug 27, 2020 03:00 AM

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In the current year, Tim sells Section 1245 property for $28,000 that he had purchased 6 years

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Adjusted Basis Original Cost Depreciation 20000 7000 13000 Since the p... View the full answer

Financial Reporting and Analysis

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