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Exercise 20-25 (LO. 3) Townsend, the sole shareholder of Pruett Corporation, has a $480,000 basis in his stock. He exchanges all of his Pruett stock
Exercise 20-25 (LO. 3) Townsend, the sole shareholder of Pruett Corporation, has a $480,000 basis in his stock. He exchanges all of his Pruett stock for $600,000 of Rogers Corporation voting common stock plus land with a fair market value of $100,000 and basis of $25,000. Pruett distributed the land to Townsend. This exchange meets all Code requirements. If an amount is zero or there is no gain or loss, enter " 0 ". a. What is Townsend's recognized gain/loss from the reorganization? Townsend recognizes of $ X. b. What is the gain/loss recognized by Pruett Corporation and Rogers Corporation on the reorganization? Rogers Corporation recognizes of $ and Pruett Corporation recognizes of \$ c. What is Townsend's basis in the Rogers stock and the land received? The basis in the Rogers stock is $ and the basis in the land is $
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