X Corporation has a single class of common stock outstanding. Mary owns 1000 shares, which she purchased five years ago for 130,000 . X declares a stock dividend payable in 8 % preferred stock having a200 par value. Each shareholder receives1share of preferred stock for10 shares of common stock. On the distribution date-December 16 of the current year-the common stock was worth 380 per share, and the preferred stock was worth 200 per share. On April 1 of the next year, Marysellsof her half preferred stock for 10500.

Cost of Preferred Shares=(Total Cost/Total Market Value)*Market Value of Preferred Share

=(130,000/400,000)*20000=6500

Gain on Sale=Selling Price-Basis of Stock=Amount Recognized Selling Preferred share

=10500-(6500/2)=7250

What is Tanya's basis in her remaining common and preferred shares after thesale