Alice Owns Land with an Adjusted Basis of $305,000, Subject

question 40

Multiple Choice

Alice owns land with an adjusted basis of $305,000, subject to a mortgage of $175,000. On April 1, 2018, Alice sells her land subject to the mortgage for $325,000 in cash, a note for $300,000, and property with a fair market value of $60,000. What is Alice's amount realized on this sale?

• A) $685,000.
• B) $800,000.
• C) $840,000.
• D) $860,000.
• E) None of the above.

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Definitions:

Kansas-Nebraska Act

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A country in North America known for its vast landscapes, multicultural diversity, and as the second-largest country in the world by total area.

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A place or refuge provided to individuals fleeing persecution, war, or violence, seeking protection and freedom in another country.