Cubs Inc. was completely liquidated. In the exchange for his 20 percent interest, Ross received land with a fair market value of $200,000. Rosss basis in the Cubs stock was $100,000. The land had a basis to Cubs Inc. of $50,000. What amount of gain does Ross recognize in the exchange and what is his basis in the land he receives? Multiple Choice

No gain recognized and a basis in the land of $50,000. No gain recognized and a basis in the land of $100,000.

$100,000 gain recognized and a basis in the land of $100,000.

$100,000 gain recognized and a basis in the land of $200,000

. Mustang Company was completely liquidated. In the exchange for its 80 percent interest, Bronco Corporation received land with a fair market value of $500,000. Broncos tax basis in the Mustang stock was $200,000. The land had a tax basis to Mustang Company of $100,000. What amount of gain does Bronco recognize in the exchange, if any, and what is its tax basis in the land it receives? Multiple Choice

No gain recognized and a basis in the land of $100,000.

No gain recognized and a basis in the land of $500,000.

$300,000 gain recognized and a basis in the land of $100,000.

$300,000 gain recognized and a basis in the land of $500,000.