Koch traded Machine 1 for Machine 2 when the fair market value of both machines was $49,400. Koch originally purchased Machine 1 for $76,200, and Machine 1's adjusted basis was $40,600 at the time of the exchange. Machine 2's seller purchased it for $64,400 and Machine 2's adjusted basis was $55,600 at the time of the exchange. What is Koch's adjusted basis in machine 2 after the exchange? Multiple Choice $40,600 $49,400 $55,600 $76,200