Note: Please show detailed calculations and explanations. Answers without showing calculations/explanations, will not receive credit. Ken and Jim agree to go into business together selling old comic books and records. According to the agreement, Ken will contribute inventory valued at $200,000 in return for 80 percent of the stock in the corporation. Ken's tax basis in the inventory is $100,000. Jim will receive 20 percent of the stock in return for providing accounting services to the corporation (these qualify as organizational expenditures). The accounting services are valued at $50,000. Please answer the following questions about the tax consequences of the transaction to Ken. a. What amount of gain or loss does Ken realize on the formation of the corporation? - $200,000$100,000=$100,000 b. What amount of gain or loss, if any, does he recognize? - 0 - Gain or loss is not reoognized on the transfer of the inventory until the inventory is sold. c. What is Ken's tax basis in the stock he receives in return for his contribution of property to the corporation? - $100,000 - Substituted basis of the inventory transferred for $100,000 is the tax basis for the stock received in the business. Please answer the following questions about the tax consequences of the transaction to Jim. d. What amount of income gain or loss does Jim reallze on the formation of the corporation? e. What amount of gain or loss, if any, does he rocognize? 1. What is Jim's tax basis in the stock he receives in return for his contribution of services to the corporation