Question
Stanley transfers a building with an adjusted basis of $150,000 and a fair market value of $200,000 to Costello Corporation in return for 85 percent
Stanley transfers a building with an adjusted basis of $150,000 and a fair market value of $200,000 to Costello Corporation in return for 85 percent its stock worth $110,000. The building is subject to a mortgage of $90,000 which Costello assumes. Assuming the transaction qualifies as a Code Sec. 351 transfer, Costello's basis in the building is:
a.$200,000
b.$150,000
c.$110,000
d.$60,000
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Accounting Principles
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
13th edition
978-1-119-4110, 1119411483, 9781119411017, 978-1119411482
