A Factory Building Owned by Amber, Inc

question 20

Multiple Choice

A factory building owned by Amber, Inc. is destroyed by a hurricane. The adjusted basis of the building was $400,000 and the appraised value was $425,000. Amber receives insurance proceeds of $390,000. A factory building is constructed during the nine-month period after the hurricane at a cost of $450,000. What is the recognized gain or loss and what is the basis of the new factory building?

• A) $0 and $450,000.
• B) $0 and $460,000.
• C) ($10,000) and $440,000.
• D) ($10,000) and $450,000.
• E) None of the above.

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Definitions:

Ejaculation

The release of semen from the male reproductive tract, typically occurring during sexual climax.

Male Breast

Tissue found on the chest of males that can develop similarly to female breasts under certain conditions, though typically less pronounced.

Female Breast

A pair of mammary glands on the chest of women and female mammals, which can produce milk to feed infants.

Anus

The opening at the end of the digestive tract through which feces exits the body.