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:

Profitability

A measure of how efficient a company is at generating profits from its resources, often expressed in terms of margins or ratios.

EBIT

A financial metric called EBIT that calculates a company's profits prior to the deduction of interest and income tax costs, encompassing all other expenses.

Operating Leverage

A financial metric that measures the proportion of fixed costs in a company's cost structure, indicating how a change in sales volume will affect operating income.

Variable Cost

Costs that vary directly with levels of production or sales volume, such as materials and labor.