Ian and Mia Married in Early 2019 and Purchased a New

question 77

Multiple Choice

Ian and Mia married in early 2019 and purchased a new home together.Each owned and lived in separate residences prior to the marriage.Ian purchased his residence 5 years ago for $190,000 and he added a master bedroom and bathroom addition at a cost of $40,000.Mia purchased her home three years ago for $135,000.In late 2019, Ian sold his residence for $510,000 and paid a sales commission of $8,000.After paying off his $80,000 mortgage balance, he received the remaining cash proceeds of $422,000.In late 2019 Mia sold her residence for $190,000 and paid a sales commission of $2,000.She had paid off her mortgage so she received $188,000 cash from the sale.If Ian and Mia file a joint tax return for 2019, how much gain do they recognize on their 2019 joint tax return from the sales of their previous homes?

• A)0
• B)$22,000
• C)$53,000
• D)$84,000

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Definitions:

Sales Climb

An increase in the number of products or services sold over a particular period of time.

Direct Distribution

A method where products are sold and delivered to consumers directly from the producer, bypassing intermediaries.

Marketing Intermediaries

are third-party firms or individuals that act as middlemen in the distribution process, connecting producers with consumers.

Physical Distribution

The set of activities concerned with moving products from the end of production to the end user, including transportation, warehousing, and inventory management.