Ann and Bob form Robin Corporation. Ann transfers property worth $420,000 (basis of $150,000) for 70 shares in Robin Corporation. Bob receives 30 shares for property worth $15,000 (basis of $3,000) and for legal services (worth $165,000) in organizing the corporation. a. What gain or income, if any, will the parties recognize on the transfer? Ann recognizes of $ and Bob recognizes of $ and has of $ b. What basis do Ann and Bob have in the Robin Corporation stock? Ann has a basis of $ while Bob has a basis of $ in the stock. c. What is Robin Corporation's basis in the property and services it received from Ann and Bob? Robin Corporation has a basis of $ in the property Ann transferred and a basis of $ in the property Bob
Ann and Bob form Robin Corporation. Ann transfers property worth $420,000 (basis of $150,000) for 70 shares in Robin Corporation. Bob receives 30 shares for property worth $15,000 (basis of $3,000) and for legal services (worth $165,000) in organizing the corporation. a. What gain or income, if any, will the parties recognize on the transfer? Ann recognizes of $ and Bob recognizes of $ and has of $ b. What basis do Ann and Bob have in the Robin Corporation stock? Ann has a basis of $ while Bob has a basis of $ in the stock. c. What is Robin Corporation's basis in the property and services it received from Ann and Bob? Robin Corporation has a basis of $ in the property Ann transferred and a basis of $ in the property Bob
Chapter18: Corporations: Organization And Capital Structure
Section: Chapter Questions
Problem 31P
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Transcribed Image Text:Problem 4-33 (LO. 1, 3)
Ann and Bob form Robin Corporation. Ann transfers property worth $420,000 (basis of $150,000) for 70 shares in Robin Corporation. Bob
receives 30 shares for property worth $15,000 (basis of $3,000) and for legal services (worth $165,000) in organizing the corporation.
a. What gain or income, if any, will the parties recognize on the transfer?
Ann recognizes
of $
and Bob recognizes
of $
and has
of $
b. What basis do Ann and Bob have in the Robin Corporation stock?
Ann has a basis of $
while Bob has a basis of $
in the stock.
c. What is Robin Corporation's basis in the property and services it received from Ann and Bob?
Robin Corporation has a basis of $
in the property Ann transferred and a basis of $
in the property Bob
transferred.
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