Zandu Corporation Exchanged a Building (Fair Market Value = $1,000,000

Multiple Choice

Zandu Corporation exchanged a building (fair market value = $1,000,000, adjusted basis = $700,000) and two semi-tractor-trailers (fair market value = $300,000; adjusted basis = $225,000) , all five years old, for land to build a new facility valued at $1,300,000.What is Zandu's realized and recognized gain and its basis in the land? Realized gain Recognized gain Basis of land

A) 0 0 $ 925,000
B) $75,000 $75,000 $1,000,000
C) $300,000 $300,000 $1,300,000
D) $375,000 $75,000 $1,000,000