Part 1: Kathleen received land as a gift from her grandfather. At the time of the gift, the land had a FMV of $105,000 and an adjusted basis of $85,000 to Kathleen's grandfather. One year later, Kathleen sold the land for $110,000. What was her gain or (loss) on this transaction?


a.. No gain or loss


b. ($5,000)


c. $20,000


d. $25,000


Part 2 If numbers were


FMV $85,000 at time of gift and adjusted basis was $110,000 to Kathleen's grandfather. One year later Kathleen sold the land for $80,000 what would her gain or (loss) be in this transaction be?


a. No gain or loss


b. ($5,000) loss


c. $5,000 gain


d. $30,000 gain