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.’s stock (FMV = $100,000): Equipment (FMV = $40,000; basis = $10,000) Land (FMV = $60,000; basis = $10,000)  What is Melanie’s basis in t

.’s stock (FMV = $100,000): Equipment (FMV = $40,000; basis = $10,000) Land (FMV = $60,000; basis = $10,000)  What is Melanie’s basis in t

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Melanie transferred the following property to M Corp. (a controlled corporation) in exchange for 100% of M Corp.’s stock (FMV = $100,000):

  • Equipment (FMV = $40,000; basis = $10,000)
  • Land (FMV = $60,000; basis = $10,000) 

What is Melanie’s basis in the M Corp. stock?

and 

What is M Corp.’s total basis in the equipment and land?

 
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