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 $ 56,000 420,000 644,000 $ 1,120,000 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 $1,020,000. The transaction met the requirements to be tax-deferred under $351. Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. g. Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000. Adjusted basis Adjusted Tax Basis $ 28,000 280,000 840,000 $ 1,148,000 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
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 $ 56,000 420,000 644,000 $ 1,120,000 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 $1,020,000. The transaction met the requirements to be tax-deferred under $351. Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. g. Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000. Adjusted basis Adjusted Tax Basis $ 28,000 280,000 840,000 $ 1,148,000 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
Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations
Section: Chapter Questions
Problem 28P
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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
$ 56,000
420,000
644,000
$ 1,120,000
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 $1,020,000. The transaction met the requirements to be tax-deferred
under §351.
Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.
g. Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the
building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000.
Adjusted basis
Adjusted Tax
Basis
$ 28,000
280,000
840,000
$ 1,148,000
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
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ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT