C and D jointly organize Z Corporation. C transfers properties to Z in exchange for $150 cash and half of Zs stock. D transfers $150 in cash to Z in exchange for the other half of the stock. Cs property consists of two parcels, parcel 1 with a basis of $120 and a value of $240 and parcel 2 with a basis of $90 and a value of $60.

A. Under 351 C has a net gain of $90 on the transfer of the two parcels and must recognize that amount of the gain because of the $150 cash boot.

B. Cs stock basis in its stock received is the basis of $210 plus $150 gain realized minus $150 cash received or $210.

C. C has a gain of $120 on parcel 1 which is recognized and a loss of $30 on parcel 2 which is not recognized.

D. C has a basis of $180 in all of the stock based on a basis of $210 in the property transferred in plus $120 in gain realized less $150 in cash received.

E. C and D.