Bud Exchanges a Business Use Machine with an Adjusted Basis

question 108

Multiple Choice

Bud exchanges a business use machine with an adjusted basis of $22,000 and a fair market value of $30,000 for another business use machine with a fair market value of $28,000 and $2,000 cash. What is Bud's recognized gain or loss?

• A)$0
• B)$2,000
• C)$6,000
• D)$8,000
• E)None of the above

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Definitions:

Units Arrive

Refers to the point in time when individual items or batches of product reach a designated location in a supply chain or manufacturing process.

M/M/1 Assumptions

The basic hypotheses underpinning the M/M/1 queue model, including assumptions of a single server, Poisson arrival rates, and exponentially distributed service times.

Average Number

A mathematical concept representing the sum of values divided by the number of values.

Utilization

Refers to the extent to which a resource, such as equipment or workforce, is being used effectively in a production process.