Janice Bought Her House in 2009 for $395,000

question 186

Multiple Choice

Janice bought her house in 2009 for $395,000. Since then, she has deducted $70,000 in depreciation associated with her home office and has spent $45,000 replacing all the old pipes and plumbing. She sells the house on July 1, 2018. Her realtor charged $34,700 in commissions. Prior to listing the house with the realtor, she spent $300 advertising in the local newspaper. Don buys the house for $500,000 in cash and assumes her mortgage of $194,000. What is Janice's adjusted basis at the date of the sale and the amount realized?

• A) $370,000 adjusted basis? $661,400 amount realized.
• B) $370,000 adjusted basis? $659,000 amount realized.
• C) $370,000 adjusted basis? $665,200 amount realized.
• D) $325,000 adjusted basis? $663,200 amount realized.
• E) $325,000 adjusted basis? $694,000 amount realized.

---

Definitions:

Three-Mountain Task

A cognitive development test designed to examine a child's ability to understand different perspectives and viewpoints.

Jean Piaget

A Swiss psychologist known for his pioneering work in child development, especially his theory of cognitive development that describes how children's minds develop and change as they grow.

Skipped Generation

The term describes family relationships where grandparents are the primary caregivers of grandchildren, with the parent generation absent in the caregiving role.

Fictive Kin

Refers to individuals who are not biologically or legally related but are considered and treated as family members due to their emotional or significant relational connection.