Reference no: EM131802823

Question - Jamie bought her house in 2006 for $395,000. Since then, she has deducted $70,000 in depreciation associated with her home office and has spent $45,000 replacing all the old pipes and plumbing. She sells the house on July 1, 2011, Her realtor charged $34,700 in commissions. Prior to listing the house with the realtor, she spent $300 advertising in the local newspaper. Sammy buys the house for $500,000 in cash, assumes her mortgage of $194,000, and pays property taxes of $4,200 for the entire year on December 1, 2011. What is Jamie's adjusted basis at the date of the sale and the amount realize?

a. $370,000 adjusted basis; $661,400 amount realized.

b. $370,000 adjusted basis; $661,100 amount realized.

c. $370,000 adjusted basis; $665,200 amount realized.

d. $325,000 adjusted basis; $663,200 amount realized.

e. $325,000 adjusted basis; $694,000 amount realized.