Accordingly, on July 8, 2018, the following exchanges took place:

Victoria contributed an office building, with a fair market value of $307,420, to Love in exchange for 22,080 shares of common stock and Love's assumption of a $70,943 liability of Victoria. Victoria incurred the liability to purchase the building on August 18, 2015, at a cost of $153,000, for its original use in Victoria's business. For book purposes, Love uses a straight-line depreciation method for the building and treats the building as having a $22,000 residual (salvage) value and 44-year service (useful) life measured from the date of its contribution.

Alexander contributed office furniture, with a fair market value of $266,627, to Love in exchange for 20,240 shares of common stock and $49,857 of cash. Alexander purchased the furniture (new) for $356,500 on August 24, 2015, for use in Alexander's business. For book purposes, Love uses a sum-of-the-years-digits depreciation method for the furniture and determined--immediately after the contribution--that the furniture would have a $13,000 residual (salvage) value and 10-year service (useful) life.

Marin contributed computer equipment, with a fair market value of $266,037, to Love in exchange for 16,560 shares of common stock and Love's assumption of a $88,679 liability of Marin. Marin incurred the liability to purchase the computers (new) on April 13, 2016, at a cost of $84,200, for use in Marin's business. For book purposes, Love usesa 150% declining balance depreciation method for the computers and determined-- immediately after the contribution--that the computers would have a $11,000 residual (salvage) value and 3-year service (useful) life.

Shelby contributed 7% preferred stock and 9% preferred stock, issued by an unrelated company, to Love in exchange for 33,120 shares of Love common stock. Shelby purchased the 7% preferred stock--which had a fair market value of $301,307 on the date of contribution--for $298,067 on November 8, 2010. Shelby purchased the 9% preferred stock--which had a fair market value of $53,408 on the date of contribution--for $31,933 on June 24, 2014. Shelby had held the preferred stock for investment purposes. Love will hold the preferred stock, which is less than 3% of the unrelated company's outstanding stock, as investment securities.

How do these transactions effect Net income?