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LenaWriter [7]
3 years ago
8

Geraldine inherited a piece of land when her father Albert died on July 26, 2015 The FMV of the land at the date of death was $4

0,000 and cost Albert $20,000 in 2009. Geraldine sold the land on March 29, 2016 for $45,000. What are the amount and nature of the gain on the sale?
Business
1 answer:
podryga [215]3 years ago
7 0
For the initial purchase, Geraldine already has the gain of 
$40,000 - $20,000  = $20,000 
Because he succcesfully bought the land below the market value.

After the sale, the total gain would be

$20,000 + ($45,000 - $20,000)

$20,000 + $ 25,000

= $45,000
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