PI:12-30 (book/static)

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BoiseBoise

Corporation exchanges a machine with a

$ 14 comma 000$14,000

basis for a new machine with an

$ 18 comma 000$18,000

FMV and

$ 3 comma 000$3,000

cash. The machines are used in

BoiseBoise's

business and are in the same General Asset Class.

Requirements

a.

DetermineBoiseBoise

Corporation's recognized gain and the basis for the new machine.b.

How would your answer to Part a change if the corporation's machine is also subject to a$ 6 comma 000$6,000

liability, and the liability is assumed by the other party?