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Grady exchanges property with a basis of $31,167 and fair market value of $37,400 for 60% of the stock of Eadie Corporation. Pedro acquired the
Grady exchanges property with a basis of $31,167 and fair market value of $37,400 for 60% of the stock of Eadie Corporation. Pedro acquired the other 40% of the stock five years ago.
Calculate Grady's current income, gain, or loss and the basis he takes in his shares of Eadie stock as a result of this transaction.
Because this transaction does not meet the control of the corporation requirement, Grady has a gain of $____________ and $___________ basis in his shares of stock.
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