Which of the following gains does not result solely in an ordinary gain or loss?
A) Sale of equipment where the accumulated depreciation exceeds the gain realized.
B) Sale of equipment where the gain realized exceeds the accumulated depreciation.
C) Sale of inventory.
D) Sale of equipment held for less than a year.
E) None of the choices are correct.

Question

Quizplus · Accepted Answer

When the gain realized on the sale of equipment exceeds the accumulated depreciation, it may result in a capital gain rather than solely an ordinary gain, depending on the tax treatment of the excess gain.

Which of the Following Gains Does Not Result Solely in an Ordinary