Doppia Company Transferred an Old Asset with a $68,750 Adjusted

question 48

Multiple Choice

Doppia Company transferred an old asset with a $68,750 adjusted tax basis in exchange for a new asset worth $90,000 and $10,000 cash.Which of the following statements is false?

• A)The old asset's FMV is $100,000.
• B)If the exchange is nontaxable,Doppia's recognized gain is $10,000.
• C)If the exchange is nontaxable,Doppia's tax basis in the new asset is $78,750.
• D)None of the statements is false.

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Definitions:

Labor

Refers to the human effort, both physical and mental, used in the production of goods and services.

Output

The amount of goods or services produced by a company, industry, or economy within a certain period.

Revenue

The total income generated by a company or organization from its normal business operations.

Marginal Product

The additional output that is produced by adding one more unit of a specific input, keeping all other inputs constant.