Wilma Waters purchased land from Carl Carmichael for $32,000 cash, the assumption of an existing mortgage of $43,000, and payment of delinquent back taxes of $8,300. Carl's adjusted basis in the land that he had purchased as an investment was $85,000. Carl also incurred $9,330 in selling costs. What is Carl's recognized gain or loss?
A) ($19,330)
B) ($11,030)
C) ($1,700)
D) $7,630
E) $11, 030

Question

Quizplus · Accepted Answer

($11,030). $73,970 amount realized ($32,000 + $43,000 + $8,300 - $9,330 selling expenses) less $85,000 adjusted basis gives a loss of ($11,030).

Wilma Waters Purchased Land from Carl Carmichael for $32,000 Cash