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zysi [14]
3 years ago
15

Shontelle owns an apartment house that has an adjusted basis of $760,000 but is subject to a mortgage of $192,000. She transfers

the apartment house to Dave and receives from him $120,000 in cash and an office building with a fair market value of $780,000 at the time of the exchange. Dave assumes the $192,000 mortgage on the apartment house.
a. What is Shontelle’s realized gain or loss?
b. What her recognized gain or loss?
c. what is the basis of the newly acquired office building?
Business
1 answer:
Alex787 [66]3 years ago
8 0

Answer:

(a) $332,000

(b) $312,000

(c) $760,000

Explanation:

(a) Her realized gain or loss

Mathematically, Realized gain or loss = Amount realized - Adjusted Basis = (120000 + 780000 + 192000) - 760000.

= 1092000 - 760000

= $ 332000

(b) Her Recognized gain.

Mathematically, her recognized gain = Amount received in cash + Amount received in Mortgage = 120,000 + 192,000 = $312,000

(c) Basis of newly acquired office Building.

Mathematically:

Basis of newly acquired building = Fair market value of building - (realized gain - recognized gain) = (780,000)-(332,000-312,000) = 780,000-20,000 = $760,000

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3 years ago
Georgia’s gross pay was $35,600 this year. She is to pay a federal income tax of 16%. How much should Georgia pay in federal inc
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In order to find federal income tax, calculate adjusted gross income.

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2 years ago
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