David Gave Property with a Basis of $133,000 to Hannah

question 84

Multiple Choice

David gave property with a basis of $133,000 to Hannah when the property had a FMV of $100,000 and paid gift taxes of $8,000.If Hannah later sells the property for $140,000,Hannah's basis (to determine gain) in the property immediately before the sale is

• A)$100,000.
• B)$108,000.
• C)$133,000.
• D)$141,000.

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Definitions:

Period

A length of time in financial reporting, often referring to a fiscal quarter or year.

Post-Closing Trial Balance

A list of all company accounts that remain after closing entries have been made, used to verify the equality of debits and credits.

Net Income

Refers to the total profit of a company after all expenses, taxes, and costs have been subtracted from total revenue.

Owner, Capital

An account on a company's balance sheet representing the owner's invested equity or interest in the business.