Eighteen-year ACRS nonresidential real property owned by an individual has accumulated accelerated depreciation of $975,000 at January 1, of this year. This property is sold on January 1, this same year. The original cost of the property was $975,000. The sale price was $1,000,000.

66. The amount of the realized and recognized gain is:

a.

a. $60,000

b.

b. $150,000

c.

c. $175,000

d.

d. $1,000,000

67. The character or nature of the gain realized and recognized is:

a.

a. All ordinary gain

b.

b. All capital gain

c.

c. $105,000 capital gain, $70,000 ordinary income

d.

d. $25,000 capital gain, $975,000 ordinary income

e.

e. None of the above

68. If the property had been depreciated using the straight-line method, which of the answers to question 67 would now be correct?

	a.	a. All ordinary gain
	b.	b. All capital gain
	c.	c. $105,000 capital gain, $70,000 ordinary income
	d.	d. $25,000 capital gain, $975,000 ordinary income
	e.	e. None of the above

e. None of the above