What to do to this engine?

Ok I am about to purchase a 93 Talon Tsi turbo awd from a friend for $250. It has the engine except for the turbo, intercooler, and tranny. What had happened was that Josh was in the middle of selling this car to a guy and the guy wanted to see the internals of the engine so they took the head off. They left it like that with the hood up over night. Well it started raining and water got into the block and head. So then when they put it back together the engine died. My question is what am I going to have to do to get it running again? I know I have to get a new tranny and turbo with intercooler but what else needs to be done?

The block will be all rusted so it will need a complete overhaul.

Is it a 6 or 7 bolt motor? If it is a 7-Bolt dont bother

How much will that cost though?

Depends on a lot of things. Are you going to rebuid it stock? or performance parts? are you going to pull the engine out yourself? What kind of condition is the head, valve train, crank and con rods in?
Plus I have no idea how much parts go for, where you live.

i had a friend get his 93 talon rebuilt at napa for $1400 and it has ran great for the last three years, replacment of the turbo and intercooler will be expensive even if you stay stock but i would say the cheapest route if you have to go that low is go to the junk yard and get some off of a car there, same kind of course, i have had some good luck with engine parts from junk yards but if you are going to do a real rebuild get some nice new parts and dont go stock replacement parts go aftermarket mitsubishi parts
but in all honesty it sounds like your friend wasnt good to his car or smart about repairs i'm guessing you will have to put a lot of money into it to get it and keep it running i would go somewhere else find a different car,