Georgia's Home Was Damaged by Flood

Multiple Choice

Georgia's home was damaged by flood.Its fair market value before and after the flood are $125,000 and $75,000,respectively.Its adjusted basis was $90,000.Georgia received $50,000 from her insurance company and she was able to have the house repaired for $40,000.What is the amount of Georgia's basis in the house after the repairs?

A) $ 40,000
B) $ 80,000
C) $ 85,000
D) $125,000
E) None of the above