In March 2012, Davis, who is single, purchased a new residence
for $200,000. During that same month he sold his former
residence for $380,000 and paid the realtor a $20,000 commission.
The former residence, his first home, had cost $65,000 in
1993. Davis added a bathroom for $5,000 in 2008. What
amount of gain is recognized from the sale of the former residence
on Davis’ 2012 tax return?