Question: Firm M exchanged an old asset with a $ 1 7 , 2 0 0 tax basis and a $ 4 0 , 0 0

Firm M exchanged an old asset with a $

17, 200

tax basis and a $

40, 000

FMV for a new asset worth $

28, 000

and $

12, 000

cash.Required:If the exchange is nontaxable, compute Firm Ms realized and recognized gain and tax basis in the new asset.How would your answers change if the new asset were worth only $

16, 500,

and Firm M received $

23, 500

cash in the exchange?

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