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Question 3 2 Mr . Ricardo exchanged 7 5 shares of Haslet common stock for 5 1 6 shares of Newland common stock pursuant to
Question
Mr Ricardo exchanged shares of Haslet common stock for shares of Newland common stock pursuant to a reorganization of the two corporations. His
basis in the Haslet stock was $ and the fair market value of the Newland stock was $ Which of the following statements about the exchange
is true?
Mr Ricardo recognizes no gain and takes a $ basis in the Newland stock.
Mr Ricardo recognizes an $ gain and takes a $ basis in the Newland stock.
Mr Ricardo recognizes no gain and takes a zero basis in the Newland stock.
Mr Ricardo recognizes no gain and takes a $ basis in the Newland stock.
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