Norman Exchanges a Machine He Uses in His Pool Construction

question 67

Multiple Choice

Norman exchanges a machine he uses in his pool construction business for a used machine worth $6,000 to use in the same business.He purchased the machine 3 years ago for $22,000 and has taken depreciation of $9,000 on the machine.In the exchange,Norman also receives $3,000 of cash.As a result of the exchange,
I.Norman's basis in the acquired machine is $10,000.
II.Norman recognizes a loss of $3,000 on the exchange.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Observing Accurately

The skill of clearly and correctly identifying and noting details of phenomena or behaviors without the influence of personal biases.

Operant Conditioning

A learning principle where behavior is shaped by its consequences, such as rewards (reinforcements) or punishments, emphasizing the role of environmental factors in influencing behavior.

Behavior Modification

The use of learning techniques to change or modify problematic behaviors by reinforcing desirable behaviors and eliminating unwanted ones.

Counterconditioning Techniques

Methods used in behavior therapy to substitute a new response for a maladaptive one through conditioning.