Ramona and Hermione formed Wiley Corporation on January 2. Ramona contributed cash of $ 215,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: FMV Adjusted Tax Basis Building $ 80,625 $ 21,500 Land 188, 125 86,000 Total $ 268,750 $ 107,500 To equalize the exchange, Wiley Corporation paid Hermione $53, 750 in addition to her stock. e. What adjusted tax basis does Wiley Corporation take in the land and building received from Hermione?
Ramona and Hermione formed Wiley Corporation on January 2. Ramona contributed cash of $ 215,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: FMV Adjusted Tax Basis Building $ 80,625 $ 21,500 Land 188, 125 86,000 Total $ 268,750 $ 107,500 To equalize the exchange, Wiley Corporation paid Hermione $53, 750 in addition to her stock. e. What adjusted tax basis does Wiley Corporation take in the land and building received from Hermione?
SWFT Essntl Tax Individ/Bus Entities 2020
23rd Edition
ISBN:9780357391266
Author:Nellen
Publisher:Nellen
Chapter12: Corporations: Organization, Capital Structure, And Operating Rules
Section: Chapter Questions
Problem 3BCRQ
Related questions
Question
Transcribed Image Text:Ramona and Hermione formed Wiley Corporation on January 2. Ramona contributed cash of $
215,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and
land with the following fair market values and adjusted tax bases in return for 50 percent of the
corporation's stock: FMV Adjusted Tax Basis Building $ 80,625 $ 21, 500 Land 188, 125 86,000
Total $ 268, 750 $ 107,500 To equalize the exchange, Wiley Corporation paid Hermione $53, 750 in
addition to her stock. e. What adjusted tax basis does Wiley Corporation take in the land and
building received from Hermione?
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 4 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you