David Drummond and Edward Engels exchange business cars. David gives Edward a car with a basis of $15,000 and a fair market value of $21,500. David receives from Edward a car with a basis of $12,500 (fair market value of $17,000) and $4,500 cash. 

What is David's recognized gain and basis in the new car?

Answer rating: 100% (QA)

To calculate Davids recognized gain and basis in the new car we need to determ... View the full answer