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Choice "b" is correct. In a corporate formation, the corporation's basis in the transferred assets is the
carryover adjusted basis from the shareholder, $500 + $30,000 = $30,500.
Choice "a" is incorrect. This answer does not take into account Stone's basis in the cash she contributed.
Choice "c" is incorrect. This answer utilizes the property's fair market value as the corporation's basis; it
should be the property's adjusted basis. 27
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Becker CPA Review, PassMaster Questions
Lecture: Regulation 3 Choice "d" is incorrect. This answer utilizes the property's cost as the corporation's basis; it should be the
property's adjusted basis. CPA-02159 Type1 M/C A-D Corr Ans: D PM#80 R 3-01 62. CPA-02159 PII May 93 #54 Page 42
What is the usual result to the shareholders of a distribution in complete liquidation of a corporation?
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This note was uploaded on 06/14/2013 for the course ACCOUNTING Regulation taught by Professor Becker during the Fall '10 term at Keller Graduate School of Management.
- Fall '10
- The Land