MGA 403 FALL 2016 HANDOUTS (\"HO\") CH 11 (2) HANDOUT SECTION 1231 PROBLEM Hilda had 160,000 of AGI before considering the effect of the transactions described below. Determine Hilda's AGI. Hilda is the owner of HA Enterprises, LLC, a single-member LDC, operating a mobile veterinary service. HA Enterprises, LLC disposed of the following assets: a. Obsolete ve-year equipment was sold for 8,000 during the year. It was fully depreciated. The equipment originally cost 45,000. A patent purchased two years ago for use in specialized veterinary procedures was sold for $21,000. At the time of sale, it had an adjusted basis of 15,000 and had originally cost 17,000. One of the pieces of equipment caught on re and was completely destroyed. It had an adjusted basis of 17,5 00. The insurance recovery was 10,000. The equipment was purchased several years ago for 40,000 and is not going to be replaced. A building housing part of the business Hilda had owned since 2004 was sold for 800,000. Total depreciation on the building was 140,000. The property had been purchased for 310,000. Assume the land constitutes 10% of the value of the property. In addition, Hilda sold GE Co stock for 43,000. It had been purchased two years ago for 59,000. A review of Hilda's prior ve returns indicates a net 1231 loss of 11,000 three years ago and a net 1231 gain of 5,000 last year