Watson sells equipment he used in his business. The equipment cost $50,000 and had an adjusted basis of $32,000 on the date of sale.
a.If Watson sells the equipment for $23,000, what is the amount and character of the recognized gain or loss?
b.If Watson sells the equipment for $55,000 what is the amount and character of the recognized gain or loss?

Question

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The Answer of Watson sells equipment he used in his business. The equipment cost $50,000 and had an adjusted basis of $32,000 on the date of sale.
a.If Watson sells the equipment for $23,000, what is the amount and character of the recognized gain or loss?
b.If Watson sells the equipment for $55,000 what is the amount and character of the recognized gain or loss?

Watson Sells Equipment He Used in His Business