(Answered) Question - mathew murphy single sold his home that he had

Accounting

Question - Mathew Murphy, single, sold his home that he had owned for 20 years for $670,000. He purchased it for $110,000 and made $40,000 of capital improvements on the home during his time of ownership.

(a) How much gain is excluded? How much is recognized?

(b) If Mathew purchased another home for $420,000, how much is excluded and recognized?

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