Client buys a building (to be a rental property) for $50,000 in 2011. There is a

Question

Client buys a building (to be a rental property) for $50,000 in 2011. There is a $40,000 mortgage on the property. Later in 2011, The client then trades a crane he paid $65,000 for a used bulldozer from another local construction company worth $75,000, and paid the difference in cash. Client then buys three riding lawn mowers for a total cost of $100,000 (for the three mowers).

What is the "original basis" for the rental property (building), bulldozer, and lawn equipment?

A) $10,000, $75,000. and $100,000 respectively

B) $50,000, $65,000, and $100,000 respectively

C) $50,000, $75,000, and $100,000 respectively

D) $65,000, $75,000, and $100,000 respectively

Explanation / Answer

Answer is C

C) $50,000, $75,000, and $100,000 respectively

building = 50000 crane = 75000

riding lawn mowers = 100000

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