Determine the amount that treated as long-term capital gain

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Problem - Amber Industries (a sole proprietorship) sold three § 1231 assets during 2019. Data on these property dispositions are as follows:

Asset

Cost

Acquired

Accumulated Depreciation

Sold for

Sold on

Rack

$100,000

10/10/15

$100,000

$145,000

10/10/19

Forklift

35,000

10/16/16

23,000

3,000

10/10/19

Bin

87,000

03/12/18

31,000

60,000

10/10/19

Required -

a. Determine the amount and the character of the recognized gain or loss from the disposition of each asset.

b. Assuming that Amber has $5,000 nonrecaptured net § 1231 losses from the five prior years, analyze these transactions and determine the amount (if any) that will be treated as a long-term capital gain.

Reference no: EM132672121

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