Glen Owns a Building That Is Used in Business

question 51

Multiple Choice

Glen owns a building that is used in business.The building is worth $200,000,but is subject to a mortgage of $40,000.Glen's basis in the building is $120,000.Glen exchanges the building for investment land worth $150,000 plus $10,000 cash.In addition,the other party assumes the mortgage which will be held for investment.Glen must recognize a gain of

• A)$0.
• B)$10,000.
• C)$50,000.
• D)$80,000.

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Definitions:

Accounts Receivable

Accounts receivable from customers for delivered goods or services awaiting payment.

Credit Customer

A customer who purchases goods or services on credit, agreeing to pay the seller at a later date.

Accounts Receivable

The money owed to a company by its customers for goods or services that have been delivered or used but not yet paid for.

Credit to Cash

A transfer or accounting entry that increases the cash balance while simultaneously increasing a corresponding credit account.