Which of the Following Statements About Boot Included in a Nontaxable

question 11

Multiple Choice

Which of the following statements about boot included in a nontaxable exchange is false?

• A) The purpose of boot is to equalize the values of the exchanged properties.
• B) The payment of boot triggers recognition of realized gain to the payer.
• C) The receipt of boot triggers recognition of realized gain to the recipient.
• D) The receipt of boot does not trigger recognition of realized loss to the recipient.

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Definitions:

Merchantable

A term that describes goods of a quality that are fit for sale or suitable for a particular purpose.

Bar of Soap

A solid piece of cleansing substance used for personal hygiene, typically formed into a rectangular shape.

Slip and Fall

Accidents that occur when a person slips, trips, or falls due to a hazardous condition on someone else's property.

Express Warranty

A clearly stated promise or guarantee by a seller regarding the quality or functionality of a product.