Clark and Hunt organized Jet Corp, with authorized voting common stock of $400,000. Clark contributed $60,000 cash.

Question:

Clark and Hunt organized Jet Corp, with authorized voting common stock of $400,000. Clark contributed $60,000 cash. Both Clark and Hunt transferred other property in exchange for Jet stock as follows:

Fair Market Value Percentage of Jet Stock Acquired Adjusted Basis Clark $ 50,000 $100,000 40% Hunt 120,000 240,000 60%

What was Clark's basis in Jet stock?

a. $0

b. $100,000

c. $110,000

d. $160,000

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...

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