Brianna traded her car to Frances for his hot tub. Brianna’s car had a basis of $15,000 and a FMV of $30,000. Brianna has a car loan of $12,000, which Frances assumes (takes over the loan from Brianna). Frances’s hot tub had a basis of $16,000 and a FMV of $18,000.

a) What is Brianna’s realized gain or loss on the exchange?

b) What is Frances’s realized gain or loss on the exchange?

c) What is Brianna’s basis in her new hot tub? 

What is Frances’s basis in his new car?