Lindas warehouse burned down. It had a basis of $250,000 and an estimated fair market...
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Accounting
Lindas warehouse burned down. It had a basis of $ and an estimated fair market value of $ Describe the tax consequences to Linda of the alternative transactions below. Assume that each of the transaction qualifies as an involuntary conversion and that Linda elects non recognition treatment she receives $ from insurance and uses the proceeds to purchase a new warehouse for $ she receives $ from insurance and uses the proceeds to purchase i a new warehouse for $ and ii a race horse for $ she receives $ from insurance, borrows an additional $ and uses the $ of insurance and debt proceeds to purchase a new warehouse she receives nothing from insurance, borrows an additional $ and uses the debt proceeds to purchase a new warehouse for $ she receives $ from insurance, purchases a new warehouse for $ and keeps the rest of the money.
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