Several years ago, your client, Brooks Robertson, started an office cleaning service. His business was very successful owing much to his legacy as the greatest defensive third baseman in major league history and his nickname, "The Human Vacuum Cleaner." Brooks operated his business as a sole proprietorship and used the cash method of accounting, Brooks was advised by his attorney that it is too risky to operate his business as a sole proprietorship and that he should incorporate to limit his liability. Brooks has come to you for advice on the tax implications of incorporation. His balance sheet is presented below. Under the terms of the incorporation, Brooks would transfer the assets to the corporation in return for 100 percent of the company's common stock. The corporation would also assume the company's abilities (payables and mortgage) Balance Sheet Assets Accounts receivable Cleaning equipment (net) building Land Total assets Liabilities Accounts payable Salaries payable Mortgage an Land and building Total Libilities Adjusted Basis FMV $ 21,000 41,000 36,600 82,000 91,000 41,000 66,00 $164.000 $214,000 5 0 . 51. $ 51.000 $ 26,000 21,000 51,000 $ 98,000 Required: a. How much gain or loss does Brooks realize on the transfer of each asset to the corporation b. How much. If any gain or loss on a per-asset basis does Brooks recognize? c. How much goin or loss, if any, must the corporation recognize on the receipt of the assets or the sole proprietorship in exchange for the corporation's stock? d. What tax basis does Brooks have in the corporation's stock? e. What is the corporation's tax basis in each asset it receives from Brooks? How much, arv, gain or loss tona per asset basis) wil Brooks recognize the had taken back a 10-year note worth $28.000 plus g. w Books be able to transfer the accounts receivable to the corporation and have the corporation recognize the income when the receivable is collected h. Brooks was depreciating the equipment 200 percent declining balance and building straight-line) using MACRS when it was held inside the proprietorship How will the corporation depreciate the equipment and building Assume Brooks owned the equipment for four years (seven year property and the building for six years