Noelle Owns an Automobile Which She Uses for Personal Use

question 70

Multiple Choice

Noelle owns an automobile which she uses for personal use.Her adjusted basis is $40,000 (i.e. ,the original cost) .The car is worth $24,000.Which of the following statements is correct?

• A)If Noelle sells the car for $24,000,her realized loss of $16,000 is not recognized.
• B)If Noelle exchanges the car for another car worth $24,000,her realized loss of $16,000 is not recognized.
• C)If the car is stolen and it is uninsured,Noelle may be able to recognize part of her realized loss of $24,000.
• D)Only a.and b.are correct.
• E)a. ,b. ,and c.are correct.

---

Definitions:

Arbitrator

A neutral third party chosen to settle disputes outside of court.

Binding Decisions

Refers to final judgments, rulings, or agreements that parties are legally obligated to follow.

Non-Lawyer

An individual who does not have the legal qualifications or license to practice law.

Appealed

The process of seeking a higher court's review of a lower court's decision in hopes of overturning or modifying the decision.