The AB Partnership Has a Machine with an FMV of $25,000

question 103

Multiple Choice

The AB Partnership has a machine with an FMV of $25,000 and a basis of $20,000. The partnership has taken an $8,000 depreciation on the machine. The unrealized receivable related to the machine is

• A)$0.
• B)$5,000.
• C)$8,000.
• D)$20,000.

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Definitions:

Evaluate

To calculate the numerical value or simplify an expression.

Calculator

An electronic or mechanical device used to perform mathematical calculations ranging from basic arithmetic to complex equations.

Simplify

The process of reducing an expression to its most compact or simplest form without changing its value.

Expression

An arrangement of symbols representing a value or denoting a mathematical operation, without an equality sign.