1 F.D. Roosevelt purchased an apartment building for $300,000. Accelerated depreciation was taken in the amount of $260,000 before the building was sold for $250,000. Straight-line depreciation would have been $245,000.

How much gain does Roosevelt recognize?

How is Roosevelts gain classified?

Would the answer change if F.D. Roosevelt is a corporation?

2 Avocado, Inc. purchased a $100,000 machine and deducted $70,000 of depreciation before selling it for $80,000 (after holding it for more than 1 year). How much gain does Avocado recognize? How is the gain classified?

How is the gain classified if Avocado sells the machine for $120,000?

How is the loss classified if Avocado sells the machine for $25,000?