Eighteen-year ACRS nonresidential real property owned by an individual has accumulated accelerated depreciation of $975,000 at January 1, of this year. This property is sold on January 1, this same year. The original cost of the property was $975,000. The sale price was $1,000,000.
66. The amount of the realized and recognized gain is:
67. The character or nature of the gain realized and recognized is:
e. None of the above
Solution 66 ) Amount of realized and recognized gain = Selling price - (cost of original asset - accumulated depreciation)
= $1000000 - ( $975000 - $975000)
= $1000000 - $0
= $1000000 ( answer) option d is correct
Solution 67) the character or nature of realized gain = all capital gain ( option b is the correct answer)
Solution 68) If property depreciated would be as per the straight-line method, even then the nature of realized gain will be all capital gain ( option b would be the correct answer)
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