Pamela and Amanda form Pansy Corporation. Pamela transfers land (basis of $40,000 and fair market value of
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Question:
Pamela and Amanda form Pansy Corporation. Pamela transfers land (basis of $40,000 and fair market value of $90,000) for 50 shares plus $10,000 cash. Amanda transfers $80,000 cash for 50 shares in Pansy Corporation.
a. Pamela's basis in the Pansy Corporation stock is $40,000.
b. Pansy Corporation's basis in the land is $40,000.
c. Pansy Corporation's basis in the land is $90,000.
d. Pamela recognizes a gain on the transfer of $50,000.
e. None of the above.
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