Prepare your answers using excel or clearly written computations. Show your work for maximum points. 1. Marie and Ramesh form Roundtree Corporation with the transfer of the following. Marie performs personal services for the corporation with a fair market value of $80,000 in exchange for 400 shares of stock. Ramesh contributes an installment note receivable (basis $25,000; fair market value $30,000), land (basis $50,000; fair market value $170,000), and inventory (basis $100,000; fair market value $120,000) in exchange for 1,600 shares. Determine Marie and Ramesh’s current income, gain, or loss; calculate the basis that each takes in the Roundtree stock.
Prepare your answers using excel or clearly written computations. Show your work for maximum points.
1. Marie and Ramesh form Roundtree Corporation with the transfer of the following. Marie performs personal services for the corporation with a fair market value of $80,000 in exchange for 400 shares of stock. Ramesh contributes an installment note receivable (basis $25,000; fair market value $30,000), land (basis $50,000; fair market value $170,000), and inventory (basis $100,000; fair market value $120,000) in exchange for 1,600 shares. Determine Marie and Ramesh’s current income, gain, or loss; calculate the basis that each takes in the Roundtree stock.
Marie performs personal services for the corporation with a fair market value of $80,000 in exchange for 400 shares of stock.
Ramesh contributes an instalment note receivable (basis $25,000; fair market value $30,000),
land (basis $50,000; fair market value $170,000), and
inventory (basis $100,000; fair market value $120,000) in exchange for 1,600 shares.
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