Problem 4-30 (LO. 1) Dan Knight and Patricia Chen, who are good friends, form Crane Corporation. Dan transfers and worth $200,000, basis of 60.000 for 50% of the stock in Crane. Patricia transfers machinery (worth $150,000, adjusted basis of 570.000) and provide services worth $50,000 for 50% of the stock a. Will the transfers qualify under 3517 Yes because all of Patricia's stockscounted in determining control since the property she transferred has than a nominal value in comparison to the value of the services rendered b. What are the tax consequences to Dan and Patrida? Dan recognizes no gain or loss on the transfer of the land. His basis in the Crane stocks a capital gain o 50.000 on the transfer. Patrida has a basis of 30,000 60,000 Patricia recognizes herrace stock c. What is Crane Corporation's basis in the land and the machinery Crane Corporation has a basis of 60,000 in the land and a basis of 30,000 in the machinery of 5 In addition, Crane either has an increase in contributed capital will capitalize the for the services provided by Patricia, or d. Enter the results of this transaction to Patricia on her Form 1040. Assume Patricia single standard deduction of $17,000 as no other income, and daim Enter all amounts as positive numbers. 1040 U.S. Individual Income Tax Return2018 B OMB No 1545-0074 RSOS 1 Your first name and initial Patrida Last name 53 Chen 3 Your social security nur BE1312245-6789 Your standard deduction It jaint return, spouse's first name and initial Last name Spouse's social security Spouse standard deduction Home address (number and street). If you have a Robo t Fut-year health care o mot (int.) Presidential Election Cam erat.) You Soouse more than four dipendent N int and here (4) Vir qualities for (see inst. child tax credit credit for other depen City Town or post office, state, and ZIP code. If you have a foreign add Dependents (see Instructions): (2) Social security number (3) Helsior You