accounting

posted by .

ann, irene, and bob incorporate their respective businesses and form Dove Corporation. Ann exchanges her property (basis of $100,000 and fair market value of $400,000) for 200 shares in Dove corporation on March 1, 2005. Irene exhanges her property (basis of $140,000 and fair market value of $600,000) for 300 shares in Dove Corporation on April 11, 2005. Bob transfer his property (basis of $250,000 and fair market value of $1,000,000) for 500 shares in Dove Corporation on May 15, 2007. Bob's transfer is not part of a prearranged plan with Ann and Irene to incorporate their businesses. What gain if any will bob recognize on the transfer?

  • accounting -

    750,000

  • accounting -

    75,000 The exchange is taxable because Bob did not hold 80% control in Dove after the transfer.

  • accounting -

    750K

Respond to this Question

First Name
School Subject
Your Answer

Similar Questions

  1. Federal Tax II

    Perry organized Cardinal Corporation 10 years ago by contributing property worth $2 million, basis of $450,000 for 2,500 shares of stock in Cardinal, representing 100% of the stock in the corporation. Perry later gave each of his children, …
  2. Accounting

    Rita forms Finch Corporation by transferring land (basis of 125,000; fair market value of 750,000) which is subject to a mortgage of 375,000. Two weeks prior to incorporating Finch, Rita borrows 125,000 for personal purposes and gives …
  3. fundamentals of taxation

    Determine the basis of stock in the hands of the shareholder in each of the following instances. Assume that the 80% rule is met in all cases. a. Contribution of property with a basis of $1,000 and a FMV of $1,400. b. Contribution …
  4. Math

    On March 31, 2009, Wolfson Corporation acquired all of the outstanding common stock of barney Corporation for $17,000,000 in cash. The book values and fair values of barney's assets and liabilities were as follows: Book value Fair …
  5. business math

    Dennison Property Company purchases a new office space for lease to small businesses for $2,400,000, including a land value of $400,000. The property is placed in service on March 15, 1999. Using MACRS, what is the depreciation on …
  6. tax

    Andre formed a corporation and owns all of the stock. He contributed property with a FMV of $10,000 and a basis of $7,000 and he received $1,000 cash from the corporation. Andre's taxable gain is: $0 $1,000 $3,000 $10,000 is it 3000
  7. Accounting

    Kathryn, an individual, own all of the outstanding stock in Copper Corporation. Kathryn purchased her stock in Copper 11 years ago, and her basis is $18,000. At the beginning of this year, the corporation has $38,000 of accumulated …
  8. accounting

    Ziegler Corporation purchased 25,000 shares of common stock of the Sherman Corporation for $40 per share on January 2, 2010. Sherman Corporation had 100,000 shares of common stock outstanding during 20 I3, paid cash dividends of $120.000 …
  9. Accounting

    3) Green Corporation is a calendar-year taxpayer. All of the stock is owned by Evan. His basis for the stock is $35,000. On March 1 (of a nonleap year), Green Corporation distributes $120,000 to Evan. Determine the tax consequences …
  10. Accounting/Finance

    Temte Corporation is authorized to issue 1,000,000 shares of no-par common stock and 250,000 shares of 6 percent, $25 par value, cumulative preferred stock. These events affected stockholders’ equity during the first year of operations: …

More Similar Questions