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In 2020, XYZ Company purchased a drill press for $92,500. Over the next three years,...

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Accounting

In 2020, XYZ Company purchased a drill press for $92,500. Over the next three years, XYZ depreciated $57,800 through MACRS depreciation. In addition, XYZ modified this drill press for $15,200, which extended the life of the drill press ($15,200 is not separately stated). In 2023, XYZ sells the drill press to a used equipment dealer for $52,100 cash. Which of the following statements is true?
Multiple Choice
XYZ has a 1245 gain of $2,200
XYZ has a capital gain of $2,200
XYZ has a 1245 gain of $17,400
All of the above statements are false.

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