Molly exchanges a small machine (adjusted basis of $85,000; fair market value of $78,000) used in her business and investment land (adjusted basis of $10,000; fair market value of $15,000) for a large machine (fair market value of $93,000) to be used in her business in a like-kind exchange. What is Molly's recognized gain or loss?
A)$0
B)$5,000
C)($2,000)
D)($7,000)
E)None of the above

Question

Quizplus · Accepted Answer

The Answer of Molly exchanges a small machine (adjusted basis of $85,000; fair market value of $78,000) used in her business and investment land (adjusted basis of $10,000; fair market value of $15,000) for a large machine (fair market value of $93,000) to be used in her business in a like-kind exchange. What is Molly's recognized gain or loss?
A)$0
B)$5,000
C)($2,000)
D)($7,000)
E)None of the above

Molly Exchanges a Small Machine (Adjusted Basis of $85,000; Fair