Paul Sells Property with an Adjusted Basis of $45,000 to His

question 86

Multiple Choice

Paul sells property with an adjusted basis of $45,000 to his daughter Dean, for $38,000. Dean subsequently sells the property to her brother, Preston, for $38,000. Three years later, Preston sells the property to Hun, an unrelated party, for $50,000. What is Preston's recognized gain or loss on the sale of the property to Hun?

• A) $0
• B) $5,000
• C) $12,000
• D) ($5,000)
• E) None of the above

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Definitions:

Altruistic Aim

The goal of acting with selfless concern for the well-being of others.

Extrinsic Goal

An objective that is motivated by external factors, such as rewards or recognition from others.

Parasympathetic Nervous System

Part of the autonomic nervous system responsible for conserving energy and promoting relaxation and recovery, often referred to as the "rest and digest" system.

Autonomic Nervous System

The part of the nervous system responsible for involuntary functions such as heart rate, digestion, and respiratory rate, comprising sympathetic and parasympathetic divisions.