Can you show the calculation of how you found the answers to the following questions:

1. Ben Baxter transfers properties X and Y to his controlled corporation.The corporation issues common stock worth $30,000and assumes the liability on property Y.

Property X is Inventory

Fair Market Value (FMV) of Property X: $30,000

Adjusted Basis of Property X: $10,000

Liability of Property X is: $0

Property Y is a Capital Asset

FMV of Property Y: $30,000

Adjusted Basis of Property Y: $10,000

Liability of Property Y: $30,000

a. How much (and what type) gain is recognized by Ben?

b. If there is no business purpose for having the corporation assume the liability, what amount of gain will Ben recognize?

2.) Norman Nagertransfers assets to a corporation that is wholly owned byhim. In exchange for the assets, Norman receivedshort-term notes with afair market value of $64,000 and stock with a fair market value of $136,000. The assets transferred to the corporation are as follows:

Asset:

Land (Sec. 1231 asset)

Building (Section 1231 asset)

Machinery

Inventory

Adjusted basis at Transfer for the Land Asset: $50,000

Adjusted basis at Transfer for the Building Asset: $50,000

Adjusted basis at Transfer for the Machinery Asset: $30,000

Adjusted basis at Transfer for the Inventory Asset: $70,000

Total Amount for the Adjusted Basis at Transfer for all the Assets: $200,000

Depreciation Recapture Potential for the Land Asset: $0

Depreciation Recapture Potential for the Building Asset: $15,000

Depreciation Recapture Potential for the Machinery Asset: $25,000

Depreciation Recapture Potential for the Land Asset: $0

Total Amount for the Depreciation Recapture Potential for all the Assets: $40,000

Fair Market Value at Transfer for the Land Asset: $25,000

Fair Market Value at Transfer for the Building Asset: $75,000

Fair Market Value at Transfer for the Machinery Asset: 25,000

Fair Market Value at Transfer for the Inventory Asset: $75,000

Total Amount for the Fair Market Value at Transfer for All the Assets: $200,000

a. How much (and what type) gain will Norman recognize on the transfer?

b. What is Norman's basis in the corporatestock and short-term notes received?

c. What is the corporation's basis in each asset it receives?