Bob Owns a Warehouse That Is Used in Business While

question 53

Multiple Choice

Bob owns a warehouse that is used in business while Rebecca owns land.Bob exchanges the warehouse for the land,which will be held for investment.The FMV of the warehouse is $440,000 (basis $240,000) ,but the warehouse is subject to a mortgage of $80,000,which is assumed by Rebecca.Bob receives $40,000 cash and the land,which has a FMV of $320,000.Bob realizes a gain (loss) on the exchange of

• A)$80,000.
• B)$120,000.
• C)$190,000.
• D)$200,000.

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Definitions:

Gasoline

A volatile, flammable liquid derived from petroleum, used primarily as fuel in internal combustion engines.

Refinery Workers

Individuals employed in the industrial process of converting raw materials, such as crude oil, into more valuable products like gasoline and diesel.

Demand Curve

A graphical representation showing the relationship between the price of a good or service and the quantity demanded by consumers.

Good X

Represents a hypothetical or generic good or product in economic models or discussions.