F and G formed a corporation on March 1 this year. F transferred equipment worth $40,000 (basis $15,000) in exchange for 40 shares of stock, and performed services worth $10,000 in exchange for 10 shares of stock. In exchange for 50 shares of stock, G contributed land worth $70,000 (basis $9,000) subject to a mortgage of $20,000, which the corporation assumed.

1. What is Gs basis in his stock after the exchange?

a. $0

b. $9,000

c. $20,000

d. $11,000

(same info as above)

2. Due to the exchange, the corporation will report which of the following?

a .Neither income nor deduction

b. Some amount of income but no amount of deduction

c. No income but some amount of deduction

d. Some amount of income and some amount of deduction

3. If G should sell his stock, the holding period will

a.include the holding period of hte land

b. begin on the date of the transfer

c. always be considered long-term regardless of hte holding period of the land or the date of hte transfer

d. always be considered short-term regardless of hte holding period of the land or the date of hte transfer