What is jason realized gain on the exchange

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Question - Jason and Mark exchange equipment each used in their business. Jason purchased his equipment for $25,000 and had taken $12,000 of depreciation on the equipment up to the date of the exchange. There was a liability on the equipment of $10,000. In the trade, Jason receives Mark's equipment that is worth $20,000. Mark assumes the $10,000 loan Jason had on the equipment. Mark's adjusted basis in his equipment is $16,000 on the date of the exchange.

a. What is Jason's realized gain on the exchange?

b. What is the amount and the character of the gain Jason must recognize on the exchange?

c. What is Jason's basis in the equipment acquired in the exchange?

Reference no: EM132084050

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