Jason Sells a Piece of Equipment for $43,000

Multiple Choice

Jason sells a piece of equipment for $43,000.The equipment was purchased four years ago for $56,000.It was depreciated using an accelerated method of depreciation.Its adjusted basis at the time of sale is $21,000.Straight-line depreciation would have been only $20,000.What is the amount and type of gain Jordan recognizes on this sale?

A) $22,000 Section 1231 gain
B) $22,000 Section 1245 gain
C) $22,000 capital gain
D) $1,000 Section 1250; $21,000 Section 1231 gain