Bud Exchanges a Business Use Machine with an Adjusted Basis

question 108

Multiple Choice

Bud exchanges a business use machine with an adjusted basis of $22,000 and a fair market value of $30,000 for another business use machine with a fair market value of $28,000 and $2,000 cash. What is Bud's recognized gain or loss?

• A)$0
• B)$2,000
• C)$6,000
• D)$8,000
• E)None of the above

---

Definitions:

Fully Recovered

The state of having completely regained health, strength, or a previous position or condition after a setback or illness.

G7 Nation

Refers to a group of seven major advanced economies: Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States, which discuss and collaborate on economic policies.

Computer-Related Industries

Sectors of the economy that involve the development, manufacturing, or provision of computer hardware, software, and related services.

Status Symbols

Objects or signs that signify the social status, wealth, or prestige of the individual possessing or displaying them.