20. Jerry uses a building for business purposes. The building was purchased on April 1, year 3 for $124,000. It was sold on October 3, year 6, for $200,000. Accumulated depreciation as the date of sale was $14,000, $4,000 of which was in excess of straight line gain in year 6 is unrecaptured Section 1250 gain? How much of the a. $4,000 b. $10,000 c. $14,000 d. $100,000 21. A lessor is paid $45,000 by its commercial tenant as a lease cancellation fee. The tenant wanted to get out of its lease so it could move to a different building. The lessor had held the lease for three years before it was canceled. The lessor had a zero tax basis for the lease. The lessor has received: a. Ordinary income of $45,000 b. Long-term capital gain of $45,000. c. Short-term capital gain of $45,000. d. Neither gain nor loss. e. None of the above. 22. A piece of depreciable machinery is sold. It has been held for three years and qualifies as Section 1231 property. The selling price is greater than the adjusted basis but less than the original purchase price. Which statement below is correct? a. All of the gain will be subject to Section 1245 recapture b. Only a portion of the gain will be subject to Section 1245 recapture c. None of the gain will be subject to Section 1245 recapture. d. Section 1245 recapture will not apply because there is a loss on the sale. 23. Jerry uses a building for business purposes. The building was purchased on April 1, year 3, for $124,000. It was sold on October 3, year 6, for $200,000. Accumulated depreciation as of the date of sale was $14,000, $4,000 of which was in excess of straight line. How much of the gain in year 6 is recaptured as ordinary under Section 1250? a. $4,000 b. $10,000 . $14,000 d. $100,000