# If norman in the preceding problem had instead sold

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Chapter 8 / Exercise 19
Finite Mathematics for the Managerial, Life, and Social Sciences: An Applied Approach
Tan
Expert Verified
75. If Norman in the preceding problem had instead sold the home for \$300,000, how much must Norman recognize? a. \$250,000 b. \$163,750 c. \$156,250 *d. \$-0- e. None of the above
76. Real property where Paul Peterson's warehouse is located is condemned by the state government on November 23, 2013. Paul's adjusted basis in the warehouse is \$420,000. He receives its \$1 million condemnation award from the state on March 5, 2014. What is the latest date that Paul can purchase qualified replacement property and be able to defer the entire \$580,000 realized gain from the condemnation?
77. Real property where Paul Peterson's warehouse is located is condemned by the state government on November 23, 2013. Paul purchased the warehouse years ago for \$800,000; its adjusted basis in the warehouse is \$420,000. He receives its \$1 million condemnation award from the state on March 5, 2014. Which of the following properties would meet the definition of "qualified replacement property" for purposes of postponing the entire realized gain on the involuntary conversion?
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Chapter 8 / Exercise 19
Finite Mathematics for the Managerial, Life, and Social Sciences: An Applied Approach
Tan
Expert Verified
d. Both a and b. *e. All of the above. 78. Real property where Paul Peterson's warehouse is located is completely destroyed by fire on November 23, 2013. Paul purchased the warehouse in 2007 for \$800,000; its adjusted basis in the warehouse is \$420,000. He receives \$1 million from the insurance company on March 5, 2014. What amount must Paul reinvest in qualified replacement property and be able to defer the entire \$580,000 realized gain from the condemnation?
79. Susan Short's office building is destroyed in a fire. The adjusted basis in the building is \$200,000 and its fair market value is \$350,000. The insurance company reimburses Susan \$330,000 for its loss, and she immediately purchases a new office building for \$310,000. What is Susan's recognized gain and adjusted basis in the new office building? *a. \$20,000 and \$200,000, respectively. b. \$0 and \$310,000, respectively. c. \$0 and \$330,000, respectively. d. \$20,000 and \$310,000, respectively. e. None of the above.
80. A corporation exchanges machinery plus \$20,000 cash for new machinery worth \$34,000. At the time of the exchange, the corporation's adjusted basis in the machine it exchanges is \$16,000 and its fair market value is \$14,000. What amount will the corporation recognize on the exchange and what will be its depreciable basis in the new machine?