Liquidation ( 332). X Corporation purchased 90% of the stock of S Corporation10 years ago for $900,000. The remaining 10% is owned by Q, an unrelated individual who purchased her S stock five years ago for $70,000. X has decided to liquidate S Corporation. X will receive assets with a fair market value of $1,425,000 and a basis to S Corporation of $850,000. S will distribute undeveloped land to Q with a fair market value of $140,000 and a basis of $126,000 as part of the liquidation.

a. How much gain or loss must X recognize?

b. What is the basis of the assets received by X?

c. How much gain or loss must S recognize?

d. How much gain or loss must Q recognize?

e. What is the basis of the land received by Q?

f. How would your answer to (a), (b), (c), (d), and (e) change if the basis of the land immediately prior to distribution was $171,000?