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olga_2 [115]
3 years ago
10

Abigail and Darcy are married. In 2017 they sold there home, which they had purchased in 2012, and lived in it since 2013. They

sold the house for $865,000. They purchased the house for $270,000 and made improvements costing $45,000. Abigail and Darcy immediately purchased another home for $800,000. What is their recognized gain in 2017 from the sale of the home assuming this is the only home they ever sold?
Business
1 answer:
iris [78.8K]3 years ago
7 0

Answer:

<u>$485,000</u>

Explanation:

Initial cost of home= $270,000+$45,000= $315,000.

Recognized gain= $800,000 - $315,000 = $485,000.

Remember, it was mentioned that Abigail and Darcy immediately purchased another home for $800,000. Very likely this money was derived from the first and only home they ever sold.

Therefore, their recognized gain after substracting the cost is $485,000.

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