To calculate a gain or loss on the sale of an asset, the proceeds from the sale are reduced by which of the following?

Question

Quizplus · Accepted Answer

The gain or loss on the sale of an asset is calculated by subtracting the tax basis of the property (original cost plus any improvements) and any selling expenses (such as brokerage fees) from the amount realized (the sale price). Therefore, both the tax basis of the property and selling expenses should be reduced from the proceeds to calculate the gain or loss.

To Calculate a Gain or Loss on the Sale of an Asset