Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Adjusted Tax FMV Basis $ 28,000 280,000 840,000 $ 1,148,000 Inventory Building $ 56,000 420,000 $ Land 644,000 $ 1,120,000 Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax-deferred under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000. g. What is the corporation's adjusted tax basis in each of the assets received in the exchange? (Do not round intermediate calculations.)
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Adjusted Tax FMV Basis $ 28,000 280,000 840,000 $ 1,148,000 Inventory Building $ 56,000 420,000 $ Land 644,000 $ 1,120,000 Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax-deferred under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000. g. What is the corporation's adjusted tax basis in each of the assets received in the exchange? (Do not round intermediate calculations.)
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 55P
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![Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for
100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values
and adjusted tax bases:
Adjusted Tax
FMV
Basis
$ 56,000
420,000
644,000
$ 1,120,000
$ 28,000
280,000
840,000
Inventory
Building
Land
$ 1,148,000
Total
The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the
corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax-deferred
under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.)
Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the
building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000.
g. What is the corporation's adjusted tax basis in each of the assets received in the exchange? (Do not round intermediate
calculations.)
Inventory
Building
Land
Adjusted basis](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F82a2c61e-b075-443a-8c26-c8eda0f652c8%2F82ddd660-ac58-47c5-9d8e-7f13946d5cd0%2Fokxhbvb_processed.png&w=3840&q=75)
Transcribed Image Text:Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for
100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values
and adjusted tax bases:
Adjusted Tax
FMV
Basis
$ 56,000
420,000
644,000
$ 1,120,000
$ 28,000
280,000
840,000
Inventory
Building
Land
$ 1,148,000
Total
The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the
corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax-deferred
under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.)
Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the
building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains $1,020,000.
g. What is the corporation's adjusted tax basis in each of the assets received in the exchange? (Do not round intermediate
calculations.)
Inventory
Building
Land
Adjusted basis
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