Frisco Inc.,a C corporation,placed a building in service in 2002 and deducted straight-line depreciation under the MACRS system in the normal manner.It sold the building this year for a substantial gain.Because straight-line depreciation was used,Frisco will not need to recognize any ordinary gain.

Question

Quizplus · Accepted Answer

While Frisco will not need to recognize any ordinary gain, it will still need to recognize some depreciation recapture as a result of the sale.