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Elizabeths factory is completely destroyed in a fire. Her basis in the factory was $3...

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Accounting

Elizabeths factory is completely destroyed in a fire. Her basis in the factory was $3 Million. Insurance paid her $5 Million. By the end of the year, she had purchased a replacement factory for $4 Million. What is the least amount of gain that Elizabeth can recognize as part of this transaction?

$1 million

$2 million

$500,000

$0

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