Tauber Inc

question 107

Multiple Choice

Tauber Inc.and J&I Company exchanged like-kind production assets.Tauber's asset had a $17,500 FMV and $3,000 adjusted tax basis,and J&I's asset had a $19,000 FMV and a $9,000 adjusted tax basis.Tauber paid $1,500 cash to J&I as part of the exchange.Which of the following statements is false?

• A)Tauber's realized gain is $14,500 and recognized gain is -0-.
• B)J&I's realized gain is $10,000 and recognized gain is -0-.
• C)Tauber's basis in its newly acquired asset is $4,500.
• D)J&I's basis in its newly acquired asset is $9,000.

---

Definitions:

Contract

A legally binding agreement between two or more parties that outlines obligations each party must fulfill.

Warranty Of Assignability

A warranty of assignability assures that a contractual right or interest can be transferred or assigned to another party.

Common Law

A legal system based on custom and court rulings as opposed to written laws passed by a legislature.

Assignor

An individual or entity that transfers rights or interests in a contract to another, known as the assignee.