Ted Purchases Some Forest Land in 2011 with the Intention

question 48

Multiple Choice

Ted purchases some forest land in 2011 with the intention of building a log cabin to use as a vacation home.To obtain the land,Ted pays $10,000 cash,assumes the seller's $19,000 mortgage on the land and pays $3,000 in commissions and legal fees related to the purchase.In 2012,Ted pays a contractor $4,000 to bulldoze and level the site of the log cabin.In 2013,Ted has a well dug and water and sewer lines laid in the ground at a cost of $6,000.Ted paid $2,000 of property taxes in 2011 and $5,000 of property taxes in 2012 and 2013 on the land.What is Ted's basis in the land at the end of 2013?

• A)$54,000
• B)$42,000
• C)$38,000
• D)$36,000
• E)$32,000

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Definitions:

Neuron Cell Bodies

The part of a neuron (nerve cell) that contains the cell nucleus and other organelles, serving as the processing unit of the neuron.

Ganglia

Structures made up of a cluster of neurons in the peripheral nervous system, functioning in transmitting nerve signals.

Voltage Fluctuations

Variations in the electrical potential difference which can lead to unstable power supply and possibly damage electronic devices.

Electroencephalograph (EEG)

A medical instrument that records the electrical activity of the brain, often used in the diagnosis of epilepsy and other brain disorders.