1. On April 1, June Moon’s warehouse burned down (adj. basis $500,000; fmv $700,000); she received $600,000 in insurance and proceeded to rebuild spending $550,000. Explain and show calculation including basis for new building.

2. On April 1, Sunny Daye, a single mom, sold her residence for $500,000 (basis $300,000). She had lived in the house for 5 years before selling it. Explain and show calculation.

Answer rating: 100% (QA)

1 Involuntary conversion occur when a property is destroyed by casualty such as fire or otherwise an... View the full answer