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McKenzie traded drilling equipment used in his business for similar equipment with slightly different features...

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Accounting

McKenzie traded drilling equipment used in his business for similar equipment with slightly different features when the fair market value of both machines was $90,000. McKenzie originally purchased his machine for $140,000, and his adjusted basis in it was $75,000 at the time of the exchange. The other party had purchased his machine for $200,000 and his adjusted basis was $85,000 at the time of the exchange. What is McKenzie's adjusted basis in Machine 2 after the exchange?

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