Margaret Moraine Exchanged a Business Auto That Had an Adjusted

Multiple Choice

Margaret Moraine exchanged a business auto that had an adjusted basis to her of $24,000 with an outstanding liability of $4,000 for a new auto with a fair market value of $22,000. Margaret paid $2,000 in cash and her liability was assumed by the other party. What is Margaret's basis in the new auto?

A) $18,000
B) $20,000
C) $22,000
D) $24,000
E) None of the above