ABC Company owns a chain of furniture stores. How much loss can ABC Company deduct in each of the following cases? Explain.
a. ABC closes a store in a depressed part of the county. Rather than move furniture to other stores, ABC sells furniture that had cost $275,000 for $140,000.
b. A fire severely damages one store. The cost of repairing the damage is $127,000. ABC's basis in the store building is $320,000. ABC's insurance company reimburses ABC $100,000 for the fire damage.
c. ABC decides to begin replacing some of its older delivery vans. It sells for $4,200 one van that had a basis of $7,300.
d. ABC discovers that one of its buildings is infested with termites. The building is old and has been fully depreciated for tax purposes. The cost of getting rid of the termites is $8,400, none of which is covered by insurance.
e. Someone breaks into one store by destroying the security system. Cash of $9,000 is missing from a safe. In addition, televisions that had cost $17,500 and were marked to sell for $34,000 are gone. The security system has a basis of $10,800. Because the system is outdated, a security expert estimates it is worth only $2,700 at the time it is destroyed.