Hannah owns an event planning company that specializes in very high-end events. Several years ago, Hannah purchased a magnificent chocolate fountain for $3,000 and has since taken $1,200 in depreciation deductions on the fountain. Hannah is now ready to replace the chocolate fountain with the tools for creating ice sculptures, but she is not sure what the tax consequences of selling the chocolate fountain will be. Which of the following statements is true regarding the tax consequences of selling the chocolate fountain? A-3

A. If Hannah sells the chocolate fountain for $1,800, she will have a $1,200 capital loss.

B. If Hannah sells the chocolate fountain for $1,700, she will have a $1,300 ordinary gain.

C. If Hannah sells the chocolate fountain for $2,000, she will have an ordinary gain of

$200.

D. If Hannah sells the chocolate fountain for $3,300, she will have a $1,500 capital gain.