Matthew exchanges an investment apartment building for a parcel of land. The apartment building has a fair market value of $80,000 and an adjusted basis of $95,000. The land's value is $60,000. Matthew receives $20,000 cash in the exchange. What is Matthew's recognized gain or (loss) on the exchange and his basis in the land?

Gain (Loss) Recognized Basis

	a.	$ - 0 - $75,000
	b.	$(15,000) $65,000
	c.	$(35,000) $85,000
	d.	$20,000 $30,000
	e.	$15,000 $35,000

ANSWER:

a

Please explain how to get the answer (a). Thank you!