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.
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.
Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations
Section: Chapter Questions
Problem 28P
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Question
Transcribed Image Text: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:
Inventory
Building
Land
Total
FMV
$ 20,000
150,000
230,000
$ 400,000
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.
Adjusted Tax
Basis
$ 10,000
100,000
300,000
$ 410,000
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.
Adjusted
basis
What is the corporation's adjusted tax basis in each of the assets received in the exchange?
Note: Do not round intermediate calculations.
Inventory
$ 12,250
Answer is not complete.
Building
Land
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