Sol purchased land as an investment on January 12, 2011, for $85,000. On January 31, 2016, Sol sold the land for $25,000 cash. In addition, the purchaser assumed the mortgage of $70,000 on the land. What is the amount realized (not gain realized) on the sale of the land?

Question

Quizplus · Accepted Answer

The amount realized on the sale of the land is the total cash and other consideration received in exchange for the property. In this case, Sol received $25,000 cash and the purchaser assumed the mortgage of $70,000. Therefore, the amount realized is $25,000 + $70,000 = $95,000.

Sol Purchased Land as an Investment on January 12, 2011