Kristi Had a Business Building Destroyed in an Earthquake

question 99

Essay

Kristi had a business building destroyed in an earthquake. The old building was purchased for $250,000, and $80,000 of depreciation deductions had been taken. Her insurance proceeds were $550,000. Although the replacement property was much larger and nicer than her old building, Kristi's new property qualified as replacement property. She acquired the new property 13 months after the earthquake for $620,000. What is the amount of Kristi's realized gain and recognized gain and the basis in her new property?

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Definitions:

Figure Panel

A segment or section of a larger diagram or illustration, often used in scientific publications to display detailed information or results.

Metaphase II

A phase of meiosis II in which the chromosomes align at the equatorial plate of the cell before being separated into two daughter cells.

Sister Chromatids

Identical copies of a chromosome, connected by a centromere, that are produced during DNA replication and are present until they are separated during cell division.

Duplicated Chromosomes

Duplicated chromosomes refer to chromosomes that have been replicated and consist of two identical sister chromatids joined at a centromere.