Question - Arthur owns a rental property with an adjusted basis $100,000.
Arthurs property is subject to a mortgage of $20, 000.
Arthur transfers the property with the $20,000 mortgage on it (which steve assumes) to Steve in exchange for (1) $10,000 in cash (2) and an apartment building with a fair market value of $150,000. Steves apartment building has no mortgage on it.
What is arthur's realized on this transaction?