Question
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporations stock. The
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporations stock. The property transferred to the corporation had the following fair market values and adjusted bases:
| FMV | Adjusted Basis | ||||
| Inventory | $ | 28,000 | $ | 14,000 | |
| Building | 210,000 | 140,000 | |||
| Land | 322,000 | 420,000 | |||
| Total | $ | 560,000 | $ | 574,000 | |
The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporations stock received in the exchange was $460,000. The transaction met the requirements to be tax-deferred under 351.
What is the corporations adjusted basis in each of the assets received in the exchange?
| inventory | building | land | |
| adjusted basis | $14,000 | ? | ? |
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The Access Audit Handbook An Inclusive Approach To Auditing Buildings
Authors: Centre For Accessible Environments
3rd Edition
1914124839, 978-1914124839
