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Please just give the correct choices for 1-5 and not just give one - the guidelines let you do more than that Five individuals, A,
Please just give the correct choices for 1-5 and not just give one - the guidelines let you do more than that
Five individuals, A, B, C, D, and E, formed X Co. After making the following transfers to X Co., they own 100% of X Co: A $40,000 cash and $15,000 worth of services BASIS B Property: FMV $50,000 MORTGAGE $30,000 $50,000 BASIS C Property: FMV $80,000 MORTGAGE $30,000 $20,000 BASIS D Property: FMV $26,000 $56,000 FMV $73,000 MORTGAGE $3,000 BASIS : (Depreciation recapture $30,000 potential of $7,000) E Property (capital asset) In return, they receive the following from X Co: A $55,000 Stock B $15,000 Stock + $5,000 Cash C$42,000 Stock + $8,000 Cash D $22,000 Stock + $4,000 Cash E $52,000 Stock + $18,000 Cash Question 1 2 pts A's reportable income and his basis in the X Co. stock is $15,000 ordinary income and $55.000 basis None of these. $15,000 ordinary income and $51.000 basis O $55,000 ordinary income and $55,000 basis Question 2 2 pts X Co's net recognized gain or loss or expense on the distribution to Ais $40,000 gain and $15,000 expense $15.000 expense None of these O $55.000 expense Question 3 2 pts B's recognized gain or loss is None of these $5,000 gain $35.000 gain Question 4 2 pts B's basis in the X Co. stock is O $55.000 O $50,000 O $15.000 None of these. Question 5 2 pts X Co.'s basis in the property received from Bis O $25,000 O $55,000 O None of these $50,000Step by Step Solution
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