Sarah, the sole owner of MT Corp., transfers a building to MT Corp. in exchange for 200 shares of its stock and $15,000 cash. The stock is valued at $90,000. Sarah purchased the building five years ago for $85,000, and its adjusted basis at transfer was $45,000. What is Sarah's recognized gain on the transfer?
Sarah, the sole owner of MT Corp., transfers a building to MT Corp. in exchange for 200 shares of its stock and $15,000 cash. The stock is valued at $90,000. Sarah purchased the building five years ago for $85,000, and its adjusted basis at transfer was $45,000. What is Sarah's recognized gain on the transfer?
Chapter3: Income Sources
Section: Chapter Questions
Problem 73P
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Transcribed Image Text:Sarah, the sole owner of MT Corp., transfers a
building to MT Corp. in exchange for 200 shares of
its stock and $15,000 cash. The stock is valued at
$90,000. Sarah purchased the building five years
ago for $85,000, and its adjusted basis at transfer
was $45,000. What is Sarah's recognized gain on
the transfer?
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