In February 2018, Judy Judd gave her son Steven a Mercedes for his graduation gift. The automobile had a basis of \(\$ 55,000\) to Judy but was worth \(\$ 85,000\) at the time of the gift. Judy paid \(\$ 21,000\) gift taxes on the gift. The taxable gift is \(\$ 70,000\) after the \(\$ 15,000\) exclusion. Assume that Steven used the car for business purposes.

a. What is Steven's gain or loss if the automobile is sold in April 2018 for \(\$ 86,000\) ?

b. What is the gain or loss recognized if the car is sold for \(\$ 56,000\) ?

c. What is the gain or loss recognized if the fair market value at the time of the gift had been \(\$ 45,000\) instead of \(\$ 85,000\) and Steven sold the car for \(\$ 86,000\) ?

d. What is the answer to

(c) if the selling price is \(\$ 44,000\) ?

e. What is the answer to

(c) if the selling price is \(\$ 47,000\) ?