Question: Herbert exchanges a business machine, which has an adjusted basis of $40,000, for a new machine worth $40,000. In addition, he receives cash of $10,000.

Herbert exchanges a business machine, which has an adjusted basis of $40,000, for a new machine worth $40,000. In addition, he receives cash of $10,000. What is the recognized gain or loss and the basis of the new machine? (Points : 5) $0 and $10,000 $0 and $50,000 $10,000 and $50,000 $10,000 and $40,000 None of the above

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