Nicole exchanged a retail building with a fair market value of $200,000 and an adjusted basis of $150,000 for a plot of undeveloped land with a fair market value of $180,000. Nicole also received $20,000 cash. What is Nicole's beginning basis in the land?
Nicole exchanged a retail building with a fair market value of $200,000 and an adjusted basis of $150,000 for a plot of undeveloped land with a fair market value of $180,000. Nicole also received $20,000 cash. What is Nicole's beginning basis in the land?
Chapter12: Nonrecognition Transactions
Section: Chapter Questions
Problem 24P
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Transcribed Image Text:Nicole exchanged a retail building with a fair market value of $200,000 and an adjusted basis of
$150,000 for a plot of undeveloped land with a fair market value of $180,000. Nicole also
received $20,000 cash. What is Nicole's beginning basis in the land?
$150,000
$170,000
O Nicole's basis in the land will be equal to the adjusted basis of the land before it was exchanged to Nicole
(in other words, the adjusted basis will transfer from the prior owner of the land)
O $200,000
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT