Question

A used machine with a purchase price of $42,397, requiring an overhaul costing $8,867, installation costs of $4,773, and special acquisition fees of $16,847, would have a cost basis of

Answer 1

The cost basis of the machine is $42,397

Step-by-step explanation:

As the purchase price of the machine is $42397 , so the cost basis of the machine will be $42,397

The term Cost basis is the original value of an asset for tax purposes, usually the purchase price . In the United States tax law, Cost basis is the original cost of property. In this case the Cost basis exclude the Overhaul costing, installation cost as well as special acquisition fee as well