Zandu Corporation exchanged a building (fair market value = $1,000,000, adjusted basis = $700,000) and two semi-tractor-trailers (fair market value = $300,000; adjusted basis = $225,000), all five years old, for land to build a new facility valued at $1,300,000. What is Zandu's realized and recognized gain and its basis in the land?
$\begin{array}{lll}
&\text { Realized gain } & \text { Recognized gain } & \text { Basis of land } \
a.&0 & 0 & \$ 925,000 \
b.&\$ 75,000 & \$ 75,000 & \$ 1,000,000 \
c.&\$ 300,000 & \$ 300,000 & \$ 1,300,000 \
d.&\$ 375,000 & \$ 75,000 & \$ 1,000,000
\end{array}$

Question

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The Answer of Zandu Corporation exchanged a building (fair market value = $1,000,000, adjusted basis = $700,000) and two semi-tractor-trailers (fair market value = $300,000; adjusted basis = $225,000), all five years old, for land to build a new facility valued at $1,300,000. What is Zandu's realized and recognized gain and its basis in the land?
$\begin{array}{lll}
&\text { Realized gain } & \text { Recognized gain } & \text { Basis of land } \
a.&0 & 0 & \$ 925,000 \
b.&\$ 75,000 & \$ 75,000 & \$ 1,000,000 \
c.&\$ 300,000 & \$ 300,000 & \$ 1,300,000 \
d.&\$ 375,000 & \$ 75,000 & \$ 1,000,000
\end{array}$

Zandu Corporation Exchanged a Building (Fair Market Value = $1,000,000