Babex IncAnd OMG Company Entered into an Exchange of Real Property

question 93

Multiple Choice

Babex Inc.and OMG Company entered into an exchange of real property.Here is the information for the properties to be exchanged. Pursuant to the exchange,OMG assumed the mortgage on the Babex property.Compute OMG's gain recognized on the exchange and its tax basis in the property received from Babex.

• A)$175,000 gain recognized; $514,500 basis in Babex property.
• B)No gain recognized; $689,500 basis in Babex property.
• C)No gain recognized; $514,500 basis in Babex property.
• D)None of the choices are correct.

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Definitions:

Molecular Phylogenies

The use of molecular data to construct evolutionary trees that represent the relationships among different species or organisms.

DNA Sequence

The precise order of nucleotides within a DNA molecule, determining genetic information.

Introns

Non-coding sections of a gene that are removed from the RNA transcript before it is translated into protein, playing roles in gene expression regulation and evolution.

Exons

Sequences of DNA within a gene that are transcribed to messenger RNA and then translated into protein.