Steve owns real estate (adjusted basis of $12,000 and fair market value of $15,000), which he uses in his business. Steve sells the real estate for $15,000 to Aubry (a dealer) and then purchases a new parcel of land for $15,000 from Joan (also a dealer). The new parcel of land would normally qualify as like-kind property. d. Assume the facts in part (a) except the adjusted basis of Steve's original parcel of land is $15,000 and the fair market value of bothparcels of land is $12,000. What are Steve's realized and recognized gain or loss on the sale of real estate?Steve has a realized loss ✓ of $3,000 and a recognized loss ✓ of $3,000 . This is because Steveis able to avoid § 1031 treatment.What is Steve's basis for the land Steve acquires from Joan?$25,000 X a. What are Steve's realized and recognized gain on the sale of the land he sold to Aubry?On the sale of real estate, Steve's realized gain is $35,000 X and recognized gain is $25,000 XFeedback►Check My Workb. Steve's basis for the land he purchased from Joan is $90,000 X

Recognized Gain -The sale of an asset at a price higher than its purchase price results in a…

Steve owns real estate (adjusted basis of $12,000 and fair market value of $15,000), which he uses in his business. Steve sells the real estate for $15,000 to Aubry (a dealer) and then purchases a new parcel of land for $15,000 from Joan (also a dealer). The new parcel of land would normally qualify as like-kind property.

Steve owns real estate (adjusted basis of $12,000 and fair market value of $15,000), which he uses in his business. Steve sells the real estate for $15,000 to Aubry (a dealer) and then purchases a new parcel of land for $15,000 from Joan (also a dealer). The new parcel of land would normally qualify as like-kind property.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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