Mr. R received bonds as a gift from his Mother.

At the time of the gifts, the bonds had a

FMV of 5,000 and adjusted basis of 6,000. No gift tax was paid. 6 months later, Mr. R
sold the bonds for 6,500. What is R computing gain?
0
5,000
6,000
6,500
6000
Mr. Cline exchanged a 30 ton press used in his business for the assets listed below.
Adjusted basis was 78,000 for Cline.
-20 ton press used in business FMV 40,000
-automobile for personal use FMV 9,500
-Cash 10,000
What was the amount of Mr. Clines Basis in the 20 ton press he received?
40,000
49,500
58,500
78,000

Answer – 58500

What statement is true with like kind exchanges?

if there is a like kind exchange of a like kind property in which you also receive cash and
the exchange results in a loss, you are allowed to deduct the loss to the extent of the
cash received

If there is an exchange of like kind property in which you also receive cash and the
exchange result in a gain to you, you cannot report the gain.

If there is a like kind exchange with like kind property in which you also recieve cash
and the exchange results in a gian to you, then you do not report the gain.

If there is an exchange of like kind property in which you also give cash and the
exchange results in a gain to you, you must report the gain to the extent of the cash
given.

Answer - If there is an exchange of like kind property in which you also receive cash
and the exchange result in a gain to you, you cannot report the gain.