Question
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases:
| FMV | Adjusted Tax Basis | |
|---|---|---|
| Inventory | $ 20,000 | $ 10,000 |
| Building | 150,000 | 100,000 |
| Land | 230,000 | 300,000 |
| Total | $ 400,000 | $ 410,000 |
The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation's stock received in the exchange was $300,000.
Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.
g. Suppose the corporation assumed a mortgage of $500,000 attached to the building and land. The fair market value of the building is $250,000 and the fair market value of the land is $530,000. The fair market value of the stock remains $300,000.
What is the corporation's adjusted tax basis in each of the assets received in the exchange?
Note: Do not round intermediate calculations.
Inventory?
Building?
Land?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
M Glichkeiten Und Grenzen Der F Rderung Verantwortlichen Handelns Von Wirtschaftspr Fern In Moralisch Relevanten Situationen Eine Theoretische Und And Accounting Studies
Authors: Catharina Schmiele
2012 Edition
383493335X, 978-3834933355
