Business, 16.03.2020 19:15 FailingstudentXD

The office building Donna owned and used for her desk-top publishing business was destroyed by a hurricane. Although the basis of the building was $80,000, Donna carried replacement cost insurance and received $160,000 from the insurance company after it was determined that the building was a complete loss. It cost her $152,000 to rebuild the store in the current year.

a. Calculate Donna's recognized gain, assuming an election under the involuntart conversion provision is made.

b. Calcualte Donna's basis in the replacement building.

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