Answer:
a. 550,000
Explanation:
The gain on the asset is calculated by the sales proceeds minus the original cost of the asset.
In this question the home' initial cost is $200,000 and it is sold on $750,000. In absence of any unusual or hardship circumstances, the direct gains is $550,000 ( $750,000 - $200,000) as all the closing costs are paid by the buyer, so, Barney ans Betty should include the whole gain of $550,000 in the gross income.
Answer:
the $400 you would have earned if you sold the toy
Explanation:
Opportunity cost or implicit is the cost of the next best option forgone when one alternative is chosen over other alternatives.
If you didn't give the toy to the child, you could have sold it for $400. Selling the toy is the next option and thus, it is the opportunity cost
