1. Benson inherited 75 acres of land on the death of his father in 2020. A Federal estate tax return was filed and the land was valued at $300,000 (its fair market value at the date of the death). The father had originally acquired the land in 1976 for $19,000 and prior to his death had made permanent improvements of $6,000. What is Bensons basis in the land?

   1. $19,000

   2. $25,000

   3. $300,000

   4. $325,000

1. Eli Company sold machinery for $48,000 on December 31, 2020. The machinery had been purchased on January 2, 2016, for $70,000 and had an adjusted basis of $31,000 at the date of the sale. For 2020, what should Eli report?

   1. Ordinary income of $17,000.

   2. A 1231 gain of $17,000 and $0 of ordinary income.

   3. Ordinary income of $48,000

   4. A 1231 gain of $31,000 and $17,000 of ordinary income.