Dean Exchanges Business Equipment with a $120,000 Adjusted Basis for $40,000

question 49

Multiple Choice

Dean exchanges business equipment with a $120,000 adjusted basis for $40,000 cash and business equipment with a $140,000 FMV.What is the amount of gain which Dean recognizes on the exchange?

• A)$0
• B)$20,000
• C)$40,000
• D)$60,000

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Definitions:

Trend Percentage

A financial analysis technique that compares certain line items in financial statements over different periods to identify patterns and growth rates.