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Mitchell and Lane form Green Corporation.

Mitchell and Lane form Green Corporation. Mitchell transfers property (basis of $105,000 and fair market value of $90,000) while Lane transfers land (basis of $8,000 and fair market value of $75,000) and $15,000 of cash. Each receives 50% of Green Corporation’s stock (total value of $180,000). As a result of these transfers:
a. Mitchell has a recognized loss of $15,000, and Lane has a recognized gain of $67,000.
b. Neither Mitchell nor Lane has any recognized gain or loss.
c. Mitchell has no recognized loss, but Lane has a recognized gain of $15,000.
d. Green Corporation will have a basis in the land of $23,000.
e. None of the above.

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CH270410_489320_ACC.doc

Mitchell and Lane form Green Corporation. Mitchell transfers property (basis of
$105,000 and fair market value of $90,000) while Lane transfers land (basis of $8,000
and fair market value of...

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