Mar$$a and Bob form Robin Corporation. Mar$$a transfers property worth $$110,000$ with a basis of $$38,500$ for $70$ shares in Robin Corporation.

Bob receives $30$ shares for property worth $$44,000$ with a basis of $$8,800$ and legal services worth $$4,400$ in organizing the corporation.

If there is no gain or loss, enter $"0"$ for the amount.

a$.$ What gain or income, if any, will the parties recognize on the transfer?

Mar$$a recognizes

$$ of $

$.$ Bob recognizes ordinary income

$$ of $

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Section $351$ is mandatory if a transaction satisfies the provision's requirements. The three requirements for nonrecognition of gain or loss under $$

$351$ are that $(1)$ property is transferred $(2)$ in exchange for stock and $(3)$ the property transferors are in control of the corporation after the

exchange.

b$.$ What basis do Mar$$a and Bob have in the Robin Corporation stock?

Mar$$a has a basis of $

$x,$ and Bob has a basis of $

$x$ in the stock.

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Incorrect