Brooks would transfer assets to the corporation in return for 100% of the company's common stock. The corporation would also assume the company's liabilities (payables and mortgage).

Adjusted Basis. FMV

Accounts Rec. $0 $5000

Cleaning Equip. net $25,000 $20,000

Building $50,000 $75,000

Land $25,000 $50,000

Total Assets $100,000 $150,000

Accounts Payable $0 $10,000

Salaries Payable $0 $5,000

Mortgage on building/land $35,000 $35,000

Total Liabilities $35,000 $50,000

a. What tax basis does Brooks have in the corporations stock?

b. What is the corporation's adjusted tax basis in each asset it receives from Brooks. A/R?, Equipment, Building, Land?

c. How much, if any, gain/loss (on per-asset basis) will Brooks recognize if he had taken back a 10-year note worth $25,000 plus stock worth $75,000 plus the liability assumptions?