Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in 100 percent of the corporation's stock. The property transferred to the corporation had the following fair marke and adjusted tax bases: Adjusted Tax Basis FMV $ 56,000 420,000 644,000 $ 1,120,000 $ 28,000 280,000 840,000 $ 1,148,000 Inventory Building Land Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax- under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if ap at is the corporation's adjusted tax basis in each of the assets received in the exchange?
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in 100 percent of the corporation's stock. The property transferred to the corporation had the following fair marke and adjusted tax bases: Adjusted Tax Basis FMV $ 56,000 420,000 644,000 $ 1,120,000 $ 28,000 280,000 840,000 $ 1,148,000 Inventory Building Land Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax- under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if ap at is the corporation's adjusted tax basis in each of the assets received in the exchange?
Chapter14: Choice Of Business Entity—operations And Distributions
Section: Chapter Questions
Problem 54P
Related questions
Question
100%
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
Basis
FMV
$ 56,000
420,000
644,000
$ 28,000
280,000
Inventory
Building
Land
840,000
$ 1,120,000
$ 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.)
d. What is the corporation's adjusted tax basis in each of the assets received in the exchange?
Inventory
Building
Land
Adjusted basis
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 2 steps
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
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT