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Answer:
A. $25,000 gain
B. ($3,000)
Explanation:
A. Calculation to determine Lucy's total gain
Amount realized $330,000
Less Adjusted basis ($305,000)
Total gain $25,000
($330,000-$305,000)
Therefore Lucy's total gain is $25,000
B. Calculation to determine her current deductible loss.
Amount realized $330,000
Less Adjusted basis ($305,000)
Total gain $ 25,000
($330,000-$305,000)
Less Suspended losses ($28,000)
Not passive Deductible loss ($3,000)
($25,000-$28,000)
Therefore her current deductible loss is ($3,000)