Self-Study Problem 11.7

Tammy has a business which she decides to incorporate. She transfers to the new C corporation real estate with a basis of $75,000 and subject to a $34,000 mortgage in exchange for all of its stock. The stock is worth $125,000.

Compute the following amounts. If an amount is none or zero, enter "0".

1. What is Tammy's realized gain? $________

2. What is Tammy's recognized gain? $________

3. What is Tammy's basis in her stock? $________

4. What is the corporation's basis in the real estate? $________