Johanne transferred investment property to S&J Corporation in exchange for 60 percent of the S&J Corporation stock (60 shares valued at $115,000). The property's fair market value was $190,000 and its adjusted tax basis to Johanne was $60,000. The investment property was subject to a $75,000 mortgage that S&J Corporation assumed on the transfer (not treated as boot). Note: Leave no answer blank. Enter zero if applicable. Required: a. Assuming the transfer qualifies under $351, what is the amount of the gain Johanne must recognize on the exchange and its character? b. What is Johanne's tax basis in the S&J stock received in the exchange? c. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an adjusted tax basis of $20,000 for additional S&J Corporation stock. What is the amount of gain Johanne must recognize on the exchange of the investment property and inventory for stock and its character? d. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an adjusted tax basis of $20,000 for additional S&J Corporation stock. What is Johanne's basis in the S&J stock received in the exchange? e. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is the amount of gain Johanne must recognize on the exchange and its character? f. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is Johanne's basis in the S&J stock received in the exchange?
Johanne transferred investment property to S&J Corporation in exchange for 60 percent of the S&J Corporation stock (60 shares valued at $115,000). The property's fair market value was $190,000 and its adjusted tax basis to Johanne was $60,000. The investment property was subject to a $75,000 mortgage that S&J Corporation assumed on the transfer (not treated as boot). Note: Leave no answer blank. Enter zero if applicable. Required: a. Assuming the transfer qualifies under $351, what is the amount of the gain Johanne must recognize on the exchange and its character? b. What is Johanne's tax basis in the S&J stock received in the exchange? c. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an adjusted tax basis of $20,000 for additional S&J Corporation stock. What is the amount of gain Johanne must recognize on the exchange of the investment property and inventory for stock and its character? d. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an adjusted tax basis of $20,000 for additional S&J Corporation stock. What is Johanne's basis in the S&J stock received in the exchange? e. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is the amount of gain Johanne must recognize on the exchange and its character? f. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is Johanne's basis in the S&J stock received in the exchange?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Bb.48.
I need part f
Transcribed Image Text:Johanne transferred investment property to S&J Corporation in exchange for 60 percent of the S&J Corporation stock (60 shares
valued at $115,000). The property's fair market value was $190,000 and its adjusted tax basis to Johanne was $60,000. The
investment property was subject to a $75,000 mortgage that S&J Corporation assumed on the transfer (not treated as boot).
Note: Leave no answer blank. Enter zero if applicable.
Required:
a. Assuming the transfer qualifies under $351, what is the amount of the gain Johanne must recognize on the exchange and its
character?
b. What is Johanne's tax basis in the S&J stock received in the exchange?
c. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an
adjusted tax basis of $20,000 for additional S&J Corporation stock. What is the amount of gain Johanne must recognize on the
exchange of the investment property and inventory for stock and its character?
d. Assume that in addition to the investment property, Johanne transferred inventory with a fair market value of $30,000 and an
adjusted tax basis of $20,000 for additional S&J Corporation stock. What is Johanne's basis in the S&J stock received in the
exchange?
e. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is the
amount of gain Johanne must recognize on the exchange and its character?
f. Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What is
Johanne's basis in the S&J stock received in the exchange?
Complete this question by entering your answers in the tabs below.
Required A
Required B
Required C Required D Required E
Required F
Assume the original facts except that the liability assumed by S&J Corporation would give rise to a deduction when paid. What
is Johanne's basis in the S&J stock received in the exchange?
Johanne's adjusted basis in the S&J stock
80,000
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