1.Bennett purchased a tract of land for $20,000 in 2011 when he heard that a new highway was going to be constructed through the property and the land would soon be worth $200,000. The highway project was abandoned in 2017 and the value of the land fell to $15,000. Bennett can claim a loss in 2017 of:

a.$165,000

b.$180,000

c.$0

d.$5,000

e.None of these choices are correct

2.

For the current year, Susan had salary income of $20,000. In addition she reported the following capital transactions during the year:

Long-term capital gain	$ 7,000
Short-term capital gain	3,000
Long-term capital loss	(2,000)
Short-term capital loss	(5,000)

There were no other items includable in her gross income. What is the amount of her adjusted gross income for the current year?

a.$23,000

b.$19,000

c.$25,000

d.$24,000

e.None of these choices are correct.

3.

Martha has a net capital loss of $20,000 and other ordinary taxable income of $45,000 for the current tax year. What is the amount of Martha's taxable income after deducting the allowed capital loss?

a.$45,000

b.$42,000

c.$38,000

d.$25,000

e.None of these choices are correct.

4.

In the current year, Henry, a sole proprietor, sold for $65,000 a machine that was used in his business. The machine had been purchased a few years ago for $50,000, and when it was sold, it had accumulated depreciation of $20,000 and an adjusted basis of $30,000. For the current year, how should this gain be treated?

a.Ordinary income of $35,000

b.Section 1231 gain of $15,000 and ordinary income of $20,000

c.Section 1231 gain of $20,000 and ordinary income of $15,000

d.Section 1231 gain of $35,000

e.None of these choices are correct

5.

Perry acquired raw land as an investment 16 years ago. The land cost $50,000. In the current year, the land is sold for a total sales price of $120,000, consisting of $10,000 cash and the buyer's note for $110,000. Assume that Perry uses the installment method to recognize the gain and receives only the $10,000 down payment in the year of sale. How much gain should Perry recognize in the current year?

a.$4,166

b.$7,000

c.$9,000

d.$5,833

e.None of these choices are correct.

6.

Which of the following is true of a like-kind exchange:

a.The properties exchanged cannot be personal residences.

b.There must be no cash exchanged to qualify.

c.A new holding period for capital gains treatment starts on the day the exchange is completed.

d.Office furniture can be exchanged for computers.

7.

Which of the following statements is true?

a.A one-time election is available to taxpayers 55 years of age or older which allows them to sell their personal residences and to exclude all of the realized gain.

b.A taxpayer who sells a personal residence may always exclude the realized gain from taxable income.

c.A taxpayer's personal residence qualifies for a like-kind exchange.

d.None of these choices are true.

e.All of these choices are true.