Henry Higgins Exchanged Property with a Basis of $100,000 and a Fair

question 3

Multiple Choice

Henry Higgins exchanged property with a basis of $100,000 and a fair market value of $125,000 for other similar property with a fair market value of $160,000. He also gave up 100 shares of Bookbinder, Inc. stock worth $25,000 with an adjusted basis of $15,000. What is Henry's realized gain and his recognized gain?

• A) Realized gain: $10,000; Recognized gain: $10,000
• B) Realized gain: $10,000; Recognized gain: $0
• C) Realized gain: $45,000; Recognized gain: $10,000
• D) Realized gain: $45,000; Recognized gain: $0

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Definitions:

Territoriality

The behavior by individuals or groups to claim and defend a specific area or territory as their own, often against others.

Cultural Background

The cultural, social, and familial influences that shape an individual's beliefs, values, and behaviors, often rooted in traditions, languages, and customs.

Social Status

The position or rank of an individual within a social hierarchy, often determined by factors like wealth, occupation, or group affiliations.

High Density

Refers to situations or environments where there is a high concentration of individuals or objects within a given area.