Lewis Corporation has two shareholders who are brothers: Ray owns 50% of the stock and Robert owns the remaining 50%. Ray and Robert each have a basis in their stock of $50,000. As of December 31, 20XX, Lewis Corporation owns the following assets: Asset Basis Fair Market Value Cash $30,000 $30,000 Land $12,000 $20,000 Equipment $40,000 $30,000 The land has a liability attached to it of $8,000. It is distributed to Ray on December 31, 20XX, and Ray assumes this liability as part of the distribution. The corporation's earnings and profits (determined before considering the effects of the distributions) are allocable to Ray and Robert as follows: Ray Robert Current Earnings and Profits $10,000 $10,000 Accumulated Earning and Profits $ 25,000 $ 25 Type your input FORMATTED RESPONSE Part A: How much income must Ray recognize and what is his basis in the land? Reset Cancel Accept Ray's gain/income 123 Basis in land Part B: How much gain must Lewis Corporation recognize on the distribution? Gain from distribution 123 Lewis Corporation has two shareholders who are brothers: Ray owns 50% of the stock and Robert owns the remaining 50%. Ray and Robert each have a basis in their stock of $50,000. As of December 31, 20XX, Lewis Corporation owns the following assets: Asset Basis Fair Market Value Cash $30,000 $30,000 Land $12,000 $20,000 Equipment $40,000 $30,000 The land has a liability attached to it of $8,000. It is distributed to Ray on December 31, 20XX, and Ray assumes this liability as part of the distribution. The corporation's earnings and profits (determined before considering the effects of the distributions) are allocable to Ray and Robert as follows: Ray Robert Current Earnings and Profits $10,000 $10,000 Accumulated Earning and Profits $ 25,000 $ 25 Type your input FORMATTED RESPONSE Part A: How much income must Ray recognize and what is his basis in the land? Reset Cancel Accept Ray's gain/income 123 Basis in land Part B: How much gain must Lewis Corporation recognize on the distribution? Gain from distribution 123