Packard Corporation transferred its 100 percent interest to State Company as part of a complete liquidation of the company. In the exchange, Packard received land with a fair market value of $445,000. Packard's basis in the State stock was $677,500. The land had a basis to State Company of $625,000. What amount of loss does State recognize in the exchange and what is Packard's basis in the land it receives? Multiple Choice $180,000 loss recognized by State and a basis in the land of $445,000 to Packard. $180,000 loss recognized by State and a basis in the land of $625,000 to Packard. No loss recognized by State and a basis in the land of $445,000 to Packard. No loss recognized by State and a basis in the land of $625,000 to Packard.
Packard Corporation transferred its 100 percent interest to State Company as part of a complete liquidation of the company. In the exchange, Packard received land with a fair market value of $445,000. Packard's basis in the State stock was $677,500. The land had a basis to State Company of $625,000. What amount of loss does State recognize in the exchange and what is Packard's basis in the land it receives? Multiple Choice $180,000 loss recognized by State and a basis in the land of $445,000 to Packard. $180,000 loss recognized by State and a basis in the land of $625,000 to Packard. No loss recognized by State and a basis in the land of $445,000 to Packard. No loss recognized by State and a basis in the land of $625,000 to Packard.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:Packard Corporation transferred its 100 percent interest to State Company as part of a complete liquidation of the company. In the exchange, Packard
received land with a fair market value of $445,000. Packard's basis in the State stock was $677,500. The land had a basis to State Company of
$625,000. What amount of loss does State recognize in the exchange and what is Packard's basis in the land it receives?
Multiple Choice
$180,000 loss recognized by State and a basis in the land of $445,000 to Packard.
$180,000 loss recognized by State and a basis in the land of $625,000 to Packard.
No loss recognized by State and a basis in the land of $445,000 to Packard.
No loss recognized by State and a basis in the land of $625,000 to Packard.
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