In the Current Year, Penny Exchanges an Investment Property in Santa

question 47

Essay

In the current year, Penny exchanges an investment property in Santa Barbara with a mountain view for a lot with an ocean view in a qualifying like-kind exchange. Penny's basis in the land given up is $100,000 and the property has a fair market value of $250,000. In exchange for her property, Penny receives land with a fair market value of $200,000 and cash of $20,000. In addition, the other party to the exchange assumes a mortgage loan on Penny's property of $30,000.
a.Calculate Penny's realized gain, if any, on the exchange.
b.Calculate Penny's recognized gain, if any, on the exchange.
c.Calculate Penny's basis in the property received.

---

Definitions:

Inflammation

A biological response of body tissues to harmful stimuli, characterized by redness, swelling, pain, and sometimes loss of function.

Habitual Snorers

Individuals who regularly snore during sleep, often indicating disrupted breathing patterns that could suggest sleep-related disorders.

Percent

A part or other object per hundred, used in expressing ratios, fractions, or comparison between parts.

Internal Disease

A disease affecting one or more internal organs of the body.