An Apartment Building with an Adjusted Basis of $500,000 Was

question 66

Multiple Choice

An apartment building with an adjusted basis of $500,000 was destroyed by a tornado on April 30,2016.On May 10,2016,the insurance company paid the owner $695,000.The owner reinvested $570,000 in a new apartment complex.What is the basis of the new complex if non-recognition of gain from an involuntary conversion is elected?

• A)$570,000.
• B)$625,000.
• C)$500,000.
• D)$695,000.

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Definitions:

Retina

The light-sensitive layer of tissue at the back of the inner eye, which converts light images into electrical signals sent to the brain through the optic nerve.

Brightness Constancy

The human visual system's ability to perceive the relative brightness of objects regardless of the amount of light illuminating them.

Cloudy Days

Days characterized by a significant coverage of the sky by clouds, often leading to reduced sunlight and cooler temperatures.

Reflects

Shows evidence of, indicates, or expresses a particular quality, condition, or situation.