Allison Buys Equipment and Pays Cash of $50,000,signs a Note

question 47

Multiple Choice

Allison buys equipment and pays cash of $50,000,signs a note of $10,000 and assumes a liability on the property for $3,000.In addition,Allison pays an installation cost of $500 and a delivery cost of $800.Allison's basis in the asset is

• A)$60,000.
• B)$63,000.
• C)$63,500.
• D)$64,300.

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Definitions:

Delivery Contract

A delivery contract is a legal agreement specifying the terms under which goods are to be transferred from a seller to a buyer.

Common Carrier

A business or agency that is available to the public for transportation of persons, goods, or services under a regulatory or legal obligation.

Delivery Duty

A responsibility assigned for the transportation and delivery of goods, ensuring they reach their destination in the agreed-upon condition and timeframe.

Risk of Loss

A legal term that determines which party bears the risk for damage or loss to goods after a transaction has occurred but before the buyer takes possession.