Butch forms World Serious Athletics, Inc. (WSA) by transferring assets he has owned for 10 years to WSA in exchange for all of its stock in a transaction that qualifies under Section 351. WSA will be a regional athletic clothing retailer. Butch transferred the following assets:

Asset Basis Fair Market Value

Cash $ 50,000 $ 50,000

Inventory 10,000 50,000

Building 25,000 250,000

The building is subject to a $100,000 mortgage. Since WSA will use the building in its operation, all asset transfers including the mortgage have a business purpose.

As a result of the transactions above compute the following:

A. Butch's gain or loss realized.

B. Butch's gain or loss recognized.

C. Butch's basis in his WSA stock.

D. WSA's basis in its assets.

E. What is Butchs holding period for his WSA stock.