A Home with a Cost Basis of $40,800 in 2003

question 47

Multiple Choice

A home with a cost basis of $40,800 in 2003 is resold today for $80,000. Commissions and closing expenses are $5,600. What is the adjusted sales price?

• A) $5,600
• B) $33,600
• C) $72,300
• D) $74,400

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Definitions:

Limited Partnership Status

A legal status for a partnership where some owners contribute capital and enjoy profits but do not participate in the management, thus limiting their liability.

General Partner

In a partnership, a party who assumes full liability for the partnership's debts and responsibilities.

Limited Partner

A type of investor in a partnership who has limited liability and is not involved in the day-to-day management of the business.

Profits

The financial gain obtained after subtracting all expenses, costs, and taxes from revenue.