Mick owns a racehorse with a $500,000 basis used for breeding purposes. The racehorse is killed in

Question:

Mick owns a racehorse with a $500,000 basis used for breeding purposes. The racehorse is killed in an accident and Mick receives $750,000 from the insurance company. Mick purchases another racehorse for $400,000.
a. What is the amount of Mick's realized gain?
b. What is the minimum amount of Mick's recognized gain, assuming the appropriate election is made?