1 2 During 2020, Edward and Sheryl, a married couple, decided to sell their residence, which had a basis of $350,000. They had owned and occupied the residence for 15 years. To make it more attractive to prospective buyers, they had the outside repaired and painted in March at a cost of $18,000 and paid for the work immediately. They sold the house in April for $700,000. Broker's commissions and other selling expenses amounted to $45,000. Since they both are age 71, they decide to rent an apartment. They purchase wife insurance with the net proceeds from the sale. What is their recognized gain? a. $350,000 b. $305,000 c. $45,000 d. $0 e $700,000