24CCH Federal Taxation—Comprehensive Topicsproperties would meet the definition of "qualified replacement property" for purposes ofpostponing the entire realized gain on the involuntary conversion?82.Real property where Paul Peterson's warehouse is located is completely destroyed byfire on November 23, 2015. Paul purchased the warehouse in 2009 for $800,000; itsadjusted basis in the warehouse is $420,000. He receives $1 million from the insurancecompany on March 5, 2016. What amount must Paul reinvest in qualified replacementproperty and be able to defer the entire $580,000 realized gain from the condemnation?a.$420,000.b.$520,000.c.$800,000.d.$1,000,000.83.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 reimbursesSusan $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 officebuilding?