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Melba purchases land from Adrian. Melba gives Adrian $225,000 in cash and agrees to pay Adrian an additional $400,000 one year later plus interest at
Melba purchases land from Adrian. Melba gives Adrian $225,000 in cash and agrees to pay Adrian an additional $400,000 one year later plus interest at 5%.
a. What is Melba?s adjusted basis for the land at the acquisition date?
b. What is Melba?s adjusted basis for the land one year later?
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