Question
Black Corporation ($900,000 assets, $0 liabilities) and White Corporation ($700,000 assets, $0 liabilities) create BW Corporation. Black transfers $600,000 in assets for all of BWs
Black Corporation ($900,000 assets, $0 liabilities) and White Corporation ($700,000 assets, $0 liabilities) create BW Corporation. Black transfers $600,000 in assets for all of BWs common stock. Black distributes its remaining assets and the BW common stock to its shareholder, Sam, for all her stock in Black (basis $950,000) and then liquidates. White transfers $400,000 in assets for all of BWs common stock. White distributes its remaining assets and the BW preferred stock to its shareholder, Taylor, for all his stock in White (basis $200,000) and then liquidates. How much is Taylors recognized gain or loss?
Group of answer choices
$0 gain
$100,000 gain
$200,000 gain
$300,000 gain
$400,000 gain
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