Brian Brewster sold property to a buyer who paid him $400,000 cash and assumed an existing mortgage of $150,000. fte property had cost $250,000 and he had made improvements of $50,000. Depreciation of
$100,000 has been claimed and selling expenses were $20,000. What is the amount of gain?

Question

Quizplus · Accepted Answer

the amount realized after selling expenses is $530,000 ($400,000 + $150,000 - $20,000) and the adjusted basis is $200,000 ($250,000 + $50,000 - $100,000). the refore, the gain is $330,000 ($530,000 - $200,000).

Brian Brewster Sold Property to a Buyer Who Paid Him