Question

# 1. For the following like-kind exchange transactions, determine: The amount of realized gain or loss The...

1. For the following like-kind exchange transactions, determine:

The amount of realized gain or loss

The amount of recognized gain or loss

The basis of the land received

 Basis of Land Exchanged FMV of Boot Received FMV of Land Received \$225,000 \$-0- \$500,000 \$465,000 \$140,000 \$550,000 \$675,000 \$350,000 \$700,000 \$800,000 \$250,000 \$600,000 \$1,000,000 \$125,000 \$750,000

Computation of the amount of realized gain or loss, amount of recognized gain or loss and the basis of the land received :

 A B C D = B + C E = D - A F = lower of B or E G = E-F H = C - G Basis of Land Exchanged FMV of Boot Received FMV of Land Received Total amount realized Realized gain Recognized gain/ (loss) Deferred gain/ (loss) Basis of the land received \$225,000 \$-0- \$500,000 \$500,000 \$275,000 \$-0- \$275,000 \$225,000 \$465,000 \$140,000 \$550,000 \$690,000 \$225,000 \$140,000 \$85,000 \$465,000 \$675,000 \$350,000 \$700,000 \$1,050,000 \$375,000 \$350,000 \$25,000 \$675,000 \$800,000 \$250,000 \$600,000 \$850,000 \$50,000 \$50,000 \$0 \$600,000 \$1,000,000 \$125,000 \$750,000 \$875,000 Loss realized = (\$125,000) \$0 (\$125,000) \$875,000

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