Alfred Ahern sold a truck with an adjusted basis of $6,000 for $1,500 to a salvage yard. He purchased a replacement truck two months later for $24,000. Alfred's basis in the new truck is $28,500.

Question

Quizplus · Accepted Answer

ftis was a sale and not a like-kind exchange
 Alfred fully recognizes the loss on the sale of the old truck and the basis of the new truck is the cost of $24,000.

Alfred Ahern Sold a Truck with an Adjusted Basis of $6,000