Jessica’s office building is destroyed by fire on November 15, 2020. The adjusted basis of the building is $430,000. She receives insurance proceeds of $620,000 on December 12, 2020. Required:...

Jessica’s office building is destroyed by fire on November 15, 2020. The adjusted basis of the building is $430,000. She receives insurance proceeds of $620,000 on December 12, 2020.

Required:

1. Calculate her realized and recognized gain or loss for the replacement property if she acquires an office building in December 2020 for $620,000.


2. Calculate her realized and recognized gain or loss for the replacement property if she acquires an office building in December 2020 for $500,000.


3. What is her basis for the replacement property in parts(a) and in(b)?


4. Calculate Jessica’s realized and recognized gain or loss if she does not invest in replacement property.