Terry purchased a machine for $15,000; the seller is holding the note. Terry paid $2,500 for the required wiring and installation. Terry has deducted depreciation on the machine for 3 years totaling $4,500. Terry owes $5,000 to the Seller. What is Terry’s adjusted basis in the machine?
Terry purchased a machine for $15,000; the seller is holding the note. Terry paid $2,500 for the required wiring and installation. Terry has deducted depreciation on the machine for 3 years totaling $4,500. Terry owes $5,000 to the Seller. What is Terry’s adjusted basis in the machine?
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter17: Business Tax Credits And The Alternative Minimum Tax
Section: Chapter Questions
Problem 6CE
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Terry purchased a machine for $15,000; the seller is holding the note. Terry paid $2,500 for the required wiring and installation. Terry has deducted depreciation on the machine for 3 years totaling $4,500. Terry owes $5,000 to the Seller. What is Terry’s adjusted basis in the machine?
$10,500
$8,000
$13,000
$5,500
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