CPA Study Group
I've always viewed buildings and equipment owned by a cop oration as capital assets. The answer to a review question on this topic stars that capital assets are limited to investments in stocks and bonds and land purchased for appreciation. Any thoughts?
Property used in a trade or business is NOT a capital asset, it is generally §1231 property (and also subject to §1245 or §1250).
See 26 U.S. Code § 1221. It defines what is NOT a capital asset, and has the highest authority.
It's one of those questions designed at fooling you into answering incorrectly. In the real world, many if not most people refer to fixed assets as capital assets. I think of them that way - in fact, I have found it's rare to deal with a corporation that holds stocks and bonds. While technically the explanation of the answer is correct, it's still a question designed to mislead, in my opinion.