Joe asks his friend Robin to join him in starting the Be You Sailing Corporation,which issued voting common stock with a fair market value of$1,400,000.They each transferred property in exchange for stock as follows.

	Property	Adjusted Basis	Fair Market Value	% of Stock Acquired
Joe	Boat	$250,000	$500,000	33%
Robin	Land and Boat Dock	$500,000*	$900,000	67%
	The land was subject to a$100,000mortgage that wasassumed by the corporation.

Would the above transfer qualify the for non-recognition of gain or loss under Code Sec.351?

1. yes,received boot
2. no,less than80%control
3. yes,80%control and only stock was exchanged
4. no,boot was received
5. no

6.What party is the Code Sec.351referring to?Who is trying to qualify for non-recognition of the gain?

1. Shareholders
2. Corporation

What would Robin(shareholder)'s basis be after the formation transaction?

1. $500,000
2. $400,000
3. $900,000
4. $250,000

Is Robin's basis in the property,stock,or both?

1. Property
2. Stock
3. Both