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A Fire Completely Destroyed a Warehouse Owned by Della Company

Question 119

Multiple Choice

A fire completely destroyed a warehouse owned by Della Company and used for nine years in its shipping business.Della's adjusted basis in the warehouse was $748,200,and its replacement value was $1 million.Unfortunately,the warehouse was uninsured.As a result of the destruction,Della recognizes:


A) $1 million ordinary loss
B) $748,200 ordinary loss
C) $748,200 Section 1231 loss
D) None of the above

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