ACCT 5011 Turquoise Realty Company owns an apartment house
January 2nd, 2018
Turquoise Realty Company owns an apartment house that has an adjusted basis of $760,000 but is subject to a mortgage of $192,000. Turquoise transfers the apartment house to Dove, Inc., and receives from Dove $120,000 in cash and an office building with a fair marekt value of $780,000 at the time of the exchange. Dove assumes the $192,000 mortgage on the apartment house.a. What is Turquoise’s realized gain or loss?b. What is its recognized gain or loss?c. What is the basis of the newly acquired office building?