In March,a Flood Completely Destroyed Three Delivery Vans Owned by Totle

question 84

Multiple Choice

In March,a flood completely destroyed three delivery vans owned by Totle Inc.Totle's adjusted tax basis in the vans was $48,900.Totle received a $90,000 reimbursement from its property insurance company,and on September 8,it purchased one new delivery van for $70,000.Compute Totle's recognized gain on loss on the involuntary conversion and its tax basis in the new van.

• A)No recognized gain or loss; $48,900 basis in the van
• B)$20,000 recognized gain; $70,000 basis in the van
• C)$20,000 recognized gain; $48,900 basis in the van
• D)None of the above

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Definitions:

Marketing Mix

A set of controllable marketing tools—Product, Price, Place, Promotion—that a company uses to pursue its marketing objectives in the target market.

Product Class

A broad category of products that serve a similar function and are perceived by consumers as interrelated or substitutable.

NAICS Designation

A system for classifying North American business establishments for the purpose of gathering, analyzing, and publishing statistical data related to the U.S. economy.

Consumer Product

Goods or services that are purchased by individuals for personal or household use, rather than for industrial or commercial purposes.