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In 2013, Sierra sold land to her son Jack for $100,000 cash and an installment note for $200,000. Sierra's adjusted basis was $150,000. In 2014, after paying $10,000 interest but nothing on the principal, Jack sold the land for $325,000 cash. As a result of the second disposition, what gain must Sierra recognize in 2014?

a. $200,000.

b. $150,000.

c. $100,000.

d. $50,000.

e. None of the choices.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M939941

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