Davidson Industries, a sole proprietorship, sold the following assets in 2018:

Davidson Industries, a sole proprietorship, sold the following assets in 2018:

AssetCostAcquiredDepreciationSale PriceSale DateWarehouse$140,00010/10/11 $24,080$162,0003/15/18Truck 21,0001/15/17  7,560 19,6001/14/18Computer 23,0007/31/17  6,095 13,6058/31/18

  1. The following questions relate to the sale of the warehouse:
  2. (1) What is the adjusted basis of the warehouse?
  3. (2) What is the realized gain on the warehouse?
  4. (3) What amount of the gain is taxed according to § 1250 rules?
  5. (4) What amount is considered a § 1231 gain before netting?
  6. The following questions relate to the sale of the truck:
  7. (1) What is the adjusted basis of the truck?
  8. (2) What is the realized gain on the truck?
  9. (3) What amount of the gain is taxed according to § 1245 rules?
  10. (4) What amount of the gain is taxed as ordinary income?
  11. The following questions relate to the sale of the computer:
  12. (1) What is the adjusted basis of the computer?
  13. (2) What is the realized gain or loss on the sale?
  14. (3) Which IRC section code applies to this asset?

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