1) Albert is considering two options for selling land for which he has an adjusted basis of $45,000

and on which there is a mortgage of $90,000. Under the first option, Albert will sell the land for

S110,000 with a stipulation in the sales contract that he liquidate the mortgage before the sale is

complete. Under the second option, Albert will sell the land for $20,000 and the buyer will

assume the mortgage. Calculate Albert's recognized gain under both options.

3) Porter exchanges land used in his business in a like-kind exchange. The property exchanged is as

follows:

Property Surrendered Property Received

Adi. Basis FMV Adi. Basis FMV

Land 50000 60000 28000 30000

Cash 25000 25000 5000 5000

What is Porter's recognized gain or loss?

a.

What is Porter's basis for the assets he received?

b.