1.

On January l, Grace leases and places into service an automobile with a FMV of $61,000. The business use of the automobile is 60%. The "inclusion amount" for the initial year of the lease from the IRS tables is $30. The annual lease payments are $11,000. What are the tax consequences of this lease?

A) deduction for lease payments of $6,582

B) deduction for lease payments of $6,570

C) deduction for lease payments of $6,600

D) deduction for lease payment of $6,630

2.

. On May 16, 2017, Ariana bought a computer for $40,000 for business use. This was the only purchase for that year. Ariana used the most accelerated depreciation method available but did not elect Sec. 179. Bonus depreciation was not available. Ariana sells the machine in 2018. The depreciation on the computer for 2018 is

A) $2,400.

B) $3,600.

C) $4,800.

D) $6,400.

3.

Leticia exchanges a business storage facility with a $100,000 adjusted basis for $25,000 cash and a parking lot with a $110,000 FMV. What is the amount of gain which Dean recognizes on the exchange?

A) $0

B) $25,000

C) $40,000

D) $60,000