. Dolzer Inc. sold a business asset with a $474,000 adjusted book and tax basis for $775,000. The purchaser paid $100,000 in cash and gave Dolzer a note for the $675,000 balance of the price. Dolzer will not receive a payment on the note until next year. Assuming that Dolzer uses the installment sale method, compute Dolzer's book and tax gain in the year of sale.

A. Book gain $301,000; tax gain $100,000 B. Book and tax gain $38,839 C. Book gain $301,000; tax gain $38,839 D. None of the above

23. Hugo Inc., a calendar year taxpayer, sold two operating assets this year. The first sale generated a $38,700 Section 1231 gain, and the second sale generated a $59,400 Section 1231 loss. As a result of these sales, Hugo should recognize:

A. $20,700 ordinary loss B. $38,700 Section 1231 gain treated as capital gain and $59,400 ordinary loss C. $20,700 capital loss D. None of the above

24. Acclaim LLC owns a residential apartment complex. During 2020, Acclaim constructed a new roof on the building. The roofing materials cost of $200,000 and labor cost $300,000. In addition, Acclaim hired an outside consultant to consider what type of roofing materials should be used on the project. Since the roof was energy efficient, Acclaim received a rebate against the cost of materials of $30,000 from a local utility. In addition, Acclaim paid $18,000 in sales tax on roofing materials and a $500 delivery charge to get the materials on site. What is Acclaims tax basis in the roof?

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25. JBH, LP sold a commercial office building used in the corporate business for $862,000. JBH purchased the building in 1991 for a cost of $700,000 and had deducted $485,900 in Section 1250 depreciation through date of sale. JBH should characterize the $647,900 gain recognized on sale as:

A. $214,100 unrecaptured Section 1250 gain and $433,800 Section 1231 gain. B. $485,900 unrecaptured Section 1250 gain and $162,000 Section 1231 gain.

C. $647,900 Section 1231 gain.

D. $647,900 Ordinary gain. E. None of these.