1. On October 2, 2015, Dave acquired and placed into service 5-year business equipment costing $70,000. No other acquisitions were made during the year. Dave does not use Sec. 179 expensing nor does he have bonus depreciation. The depreciation expense for 2015 is

A. $0

B. $3,500

C. $7,000

D. $10,003

2. During the current year, a corporation sells equipment for $300,000. The equipment cost of $270,000 when purchased and placed in service two years ago and $60,000 of depreciation deductions were allowed. The result of the sale are

A. Ordinary income of $90,000

B. Sec. 1231 gain of $90,000

C. Ordinary income of $60,000 and long-term capital gain of $30,000

D. Ordinary income of $60,000 and Sec. 1231 gain of $30,000