On June 3, 2021 Robert, Larry, Kevin, Danny, and Dennis contribute the following assets to form the Celtic Corporation. Robert contributes land and a building. He purchased the property in 2010. The building is worth $180,000 (adjusted basis $60,000) and the land is worth $120,000 (adjusted basis $45,000). The land and building are subject to a $160,000 mortgage which is assumed by the corporation. Robert deducted $25,000 of depreciation on the building. Robert receives 2,800 shares of Celtic stock. Larry transfers machinery and equipment purchased in 2015. The machinery is worth $36,000 (adjusted basis $45,000) and the equipment is worth $54,000 (adjusted basis $25,000). He deducted $35,000 of depreciation on the machinery and $45,000 of depreciation on the equipment. Larry receives 1,700 shares of Celtic stock and a $5,000, 5% note due in five years. Kevin contributes a truck that he used in another business venture. He purchased the truck in 2017. The truck is worth $70,000 (adjusted basis $105,000). Kevin deducted $30,000 of depreciation. Kevin receives 1,200 shares of Celtic stock and $10,000 cash. Danny contributes machinery and $15,000 cash. He purchased the machinery in 2016. The machinery is worth $30,000 (adjusted basis $20,000). He deducted $20,000 of depreciation. Danny receives 900 shares of Celtic stock. Dennis provides legal services incident to the incorporation worth $75,000. He also contributes cash of $25,000. Dennis receives 2,000 shares of Celtic stock. Each share of Celtic stock is worth $50 per share. Required: (a) Does Sec. 351 apply to this corporate formation? Explain why or why not. (b) For each shareholder: (1) compute their realized gain or loss (2) compute their recognized gain or loss (if any) (3) determine the character of the gain or loss (if any) (4) compute the basis for the stock (5) determine when the holding period begins for the stock (c) Prepare Celtics tax-basis balance sheet as of June 3, 2021 (assets = liabilities + equity). (d) How would the corporation treat the services provided by Dennis?