In 2023, Edward and Ella form EE, Inc., a C-corporation. Ella contributed $120,000 in cash in exchange for 1,000 shares in EE. Edward contributed an asset with a fair market value of $140,000 and an adjusted basis of $130,000 in exchange for $20,000 of cash and 1,000 shares of EE stock.

Question 9 options:

	Edward will recognize a $20,000 gain.
	Edward will recognize a $20,000 loss.
	Edward's basis in EE stock is $130,000. EE basis in the property contributed by Edward is $130,000.
	Ella's basis in her EE stock is $120,000 and Edward's basis in his AE stock is $120,000.
	None of the above.