Rufus Inc. and Hardy Company are negotiating a nontaxable exchange of business properties. Rufuss property has a $50,000 tax basis and a $77,500 FMV. Hardys property has a $60,000 tax basis and a $90,000 FMV.

Which party to the exchange must pay boot to make the exchange work? How much boot must be paid?

Assuming the boot payment is made, how much gain or loss will Rufus realize and recognize on the exchange and what tax basis will Rufus take in the property acquired?

Assuming the boot payment is made, how much gain or loss will Hardy realize and recognize on the exchange and what tax basis will Hardy take in the property acquired?