Lucy transfers equipment (basis of $35,000 and fair market value of $120,000) to White Corporation. In return, Lucy receives 90% of White Corporations stock (worth $70,000). In addition, there is an outstanding business loan for $30,000 (taken out 5 years ago) on the equipment, which White Corporation assumes.

What is Lucys recognized gain or loss?

What is Lucys basis in the White stock?

What is Whites basis in the equipment?