Laura Johnson, who is single, purchased a home in Boulder, Colorado, for $360,000. She moved into the home on April 1 of Year 1 and lived there as her primary residence until July 31 of Year 5. She sold the home for $700,000. 1. What amount of gain will Laura be required to recognize on the sale of the home? 2. Assume the original facts, except that the home is Laura's vacation home, and she spend three months there each year. Laura does not rent the home to others. What gain must Laura recognize on the home sale?
Laura Johnson, who is single, purchased a home in Boulder, Colorado, for $360,000. She moved into the home on April 1 of Year 1 and lived there as her primary residence until July 31 of Year 5. She sold the home for $700,000. 1. What amount of gain will Laura be required to recognize on the sale of the home? 2. Assume the original facts, except that the home is Laura's vacation home, and she spend three months there each year. Laura does not rent the home to others. What gain must Laura recognize on the home sale?
Chapter15: Property Transactions: Nontaxable Exchanges
Section: Chapter Questions
Problem 40P
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Please need answer this general accounting question
Transcribed Image Text:Laura Johnson, who is single, purchased a home in Boulder, Colorado, for
$360,000. She moved into the home on April 1 of Year 1 and lived there as her
primary residence until July 31 of Year 5. She sold the home for $700,000.
1. What amount of gain will Laura be required to recognize on the sale of the
home?
2. Assume the original facts, except that the home is Laura's vacation home, and
she spend three months there each year. Laura does not rent the home to
others. What gain must Laura recognize on the home sale?
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