Amber, Georgie, Ross, and Aaron have decide to combine their resources to form AGRA, Inc., a C-corporation. The shareholders contribute the following assets in exchange for stock in AGRA

Adjusted Fair Market No. of shares

Basis Value Issued

Amber:

• Cash $ 50,000 150 shares
• Unrealized accounts receivable $0 100,000

Georgie:

• Georgie is a computer engineer who received stock in exchange for services provided $50,000 50 shares

Ross

• Land and Building 80,000 500,000
• Mortgage (100,000) (100,000) 400 shares

Aaron

• Manufacturing equipment 120,000 750,000 700 shares
• In addition to stock, Aaron also received $50,000 in cash

For Ross:

1. Will Ross recognize income/gain/loss?
2. What is Ross's basis in AGRA stock?
3. What is AGRA's basis in the land and building contributed by Ross?