Kelko sells a plece of equipment used in her business for $14,853 on August 10, 2016....

 

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Kelko sells a plece of equipment used in her business for $14,853 on August 10, 2016. The equipment was purchased on January 4, 2015 at a cost of $12,849. Kelko has taken $3,855 of depreciation on the equipment. What is the amount and classification of the gain on the sale by Keiko? O$5,859 ordinary income under Section 1245. O $5,859 Section 1231 gain. O $3,855 ordinary income under Section 1245 and $2,004 Section 1231 gain. O $3,855 Section 1231 gain and $2,004 ordinary income under Section 1245. Kelko sells a plece of equipment used in her business for $14,853 on August 10, 2016. The equipment was purchased on January 4, 2015 at a cost of $12,849. Kelko has taken $3,855 of depreciation on the equipment. What is the amount and classification of the gain on the sale by Keiko? O$5,859 ordinary income under Section 1245. O $5,859 Section 1231 gain. O $3,855 ordinary income under Section 1245 and $2,004 Section 1231 gain. O $3,855 Section 1231 gain and $2,004 ordinary income under Section 1245.

Answer rating: 100% (QA)

Solution Sale value of equipment 14853 Original cost of equipment 12849 Depreciation ch... View the full answer