Alice owns land with an adjusted basis of $610,000 subject to a mortgage of $350,000. On April 1, Alice sells her land to Marcia $650,000 in cash, a note for $600,000, and property with a fair market value of $120,000. Marcia assumes Alices mortgage of $350,000. The amount realized is $1,720,000.

11. What is Alices adjusted basis at the time of the sale?

		a. $0
		b. $260,000
		c. $610,000
		d. $960,000

12. What is Alices gain or loss realized from the sale?

		a. $0 gain or loss realized
		b. $610,000 gain realized
		c. $760,000 gain realized
		d. $1,110,000 gain realized