Itak Company Transferred an Old Asset with a $44,300 Adjusted

Multiple Choice

Itak Company transferred an old asset with a $44,300 adjusted tax basis in exchange for a new asset worth $48,000 and $3,000 cash. Which of the following statements is false?

A) If the exchange is taxable, Itak recognizes a $6,700 gain.
B) If the exchange is nontaxable, Itak recognizes a $3,000 gain.
C) If the exchange is nontaxable, Itak's tax basis in the new asset is $44,300.
D) None of these statements are false.