Question: Boise Corporation exchanges a machine with a $14,000 basis for a new machine with an $18,000 FMV and $3,000 cash. The machines are used in

Boise exchanges a machine with a $14,000 basis for a new machine with an $18,000 FMV and $3,000 cash. The machines are used in Boise’s business and are in the same General Asset Class.
a. Determine Boise Corporation’s recognized gain and the basis for the new machine.
b. How would your answer to Part a change if the corporation’s machine is also subject to a $6,000 liability, and the liability is assumed by the other party?

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