Melba purchases land from Adrian. Melba gives Adrian $655,000 in cash and agrees to pay Adrian an additional $982,500 one year later plus interest at 6%.

a. What is Melba's adjusted basis for the land at the acquisition date? $

b. What is Melba's adjusted basis for the land one year later? $

 

Sebastian purchases two pieces of equipment for $175,000. Appraisals of the equipment indicate that the fair market value of the first piece of equipment is $122,500 and that of the second piece of equipment is $192,500. What is Sebastian's basis in these two assets?

 

 

Answer rating: 100% (QA)

a To determine Melbas adjusted basis for the land at the acquisition date we need to consider the cash payment and the future payment with interest Th... View the full answer