Norman Exchanges a Machine He Uses in His Pool Construction

question 110

Multiple Choice

Norman exchanges a machine he uses in his pool construction business for a used machine worth $6,000 to use in the same business. He purchased the machine 3 years ago for $22,000 and had taken depreciation of $9,000 on the machine. In the exchange, Norman also receives $3,000 of cash. As a result of the exchange,
I.Norman realizes a loss of $4,000 on the exchange.
II.Norman's basis in the acquired machine is $13,000.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Daily Recommended

A guideline or amount suggested for consumption or usage each day to maintain health or achieve specific dietary or nutritional goals.

Fiber Intake

The amount of dietary fiber consumed, important for digestive health.

Omega-3 Fatty Acids

Essential fats the body cannot produce by itself; they play a crucial role in brain function as well as normal growth and development.

Fish Sources

Dietary items obtained from fish, rich in nutrients such as omega-3 fatty acids, protein, vitamins, and minerals, significant for heart and brain health.