Russell Corporation sold a parcel of land valued at $400,000. Its basis in the land was $275,000.

Question:

Russell sold a parcel of land valued at $400,000. Its basis in the land was $275,000. For the land, Russell received $50,000 in cash in year 0 and a note providing that Russell will receive $175,000 in year 1 and $175,000 in year 2 from the buyer.
a. What is Russell's realized gain on the transaction?
b. What is Russell's recognized gain in year 0, year 1, and year 2?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...