QUESTION 23 Geneva, a sole proprietor, sold one of her non-depreciable business assets for a $20,000 long-term capital gain. Geneva's marginal tax rate is 28%. Gulf, a C corporation, sold one of its assets for a $20,000 long-term capital gain. Gulfs marginal tax rate is 3596. What tax rates are applicable to these capital gains? A. 35% rate applies to both Geneva and Gulf B. The special capital gains tax rate in effect for the year in which the transaction occurred applies to both Geneva and Gulf C. A special capital gains tax rate applies to Geneva and 35% rate applies to Gulf D. Cannot determine; tax rate is dependent upon other factors not provided QUESTION 24 Elk, a C corporation, has $400,000 operating income and $350,000 operating expenses during the year. In addition, Elk has a $30,000 long-term capital gain and a $52,000 short-term capital loss. Elk's taxable income is: O A. ($2,000) B. $28,000 C. $50,000 D. $80,000 E. None of these is correct QUESTION 25 In previous years, Center City had received a $400,000 gift of cash and investments. The donor had specified that the earnings from the gift must be used to beautify city-owned parks and the principal must be re- invested. During the current year, the earnings from this gift were $24,000. The earnings from this gift should generally be considered revenue to which of the following funds? A. Special revenue fund B. Private-purpose trust fund OC. Agency fund D. Permanent fund QUESTION 26 Which of the following activities of a governmental entity should be accounted for in a fiduciary fund? A. Funds received from the federal government to support public transportation activities B. Funds received from an individual who specified that the principal must be kept intact but the income can be used to support families of police officers killed in the line of duty C. Funds received from the state government that must be used to purchase capital assets D. Funds received from a contractor to assist with the development of utility infrastructure