Johnson Inc

question 76

Multiple Choice

Johnson Inc. and C&K Company entered into an exchange of real property. Here is the information for the properties to be exchanged. Pursuant to the exchange, C&K paid $25,000 cash to Johnson and assumed the mortgage on the Johnson property. Compute Johnson's gain recognized on the exchange and its tax basis in the property received from C&K.

• A) $25,000 gain recognized; $593,000 basis in C&K property
• B) $25,000 gain recognized; $793,000 basis in C&K property
• C) $225,000 gain recognized; $593,000 basis in C&K property
• D) None of the above

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Definitions:

Cultural Heritage

The legacy of physical artifacts and intangible attributes of a group or society inherited from past generations, preserved for future generations.

Culture

The shared values, traditions, norms, customs, arts, history, folklore, and institutions of a group of people.

Sociohistorical Context

The social and historical setting that influences an event, idea, or concept, providing a backdrop that helps to understand contemporary issues.

Freud's Theory

A set of psychoanalytic theories developed by Sigmund Freud that emphasize the influence of the unconscious mind on behavior.