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Gabriella and Juanita form Luster Corporation, each receiving 50 shares of its stock. Gabriella transfers cash of $50,000, while Juanita transfers a secret process (basis

Gabriella and Juanita form Luster Corporation, each receiving 50 shares of its stock. Gabriella transfers cash of $50,000, while Juanita transfers a secret process (basis of zero and a fair market value of $50,000). Neither Gabriella nor Juanita recognizes gain as a result of these transfers. 1. True 2. False

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