Norman $30,000 in money to Elnor Corporation in exchange for 50 shares of Elnor stock. The transfers machinery, used in Norman's business, originally cost him $150,000 and is subject to a $84,000 liability which Elnor Corporation assumes. Kate exchanges $51,000 cash that for the remaining 50 shares of Elnor stock. has a a. What are the amount and character of Norman's recognized gain or loss? $45,000 b. What is his basis in the Elnor stock? and c. What is basis in the machinery? a d. What are the amount and character of Kate's recognized gain or loss? $105,000 e. What is Kate's basis in the Elnor stock? FMV and f. When do Norman and Kate's holding periods for their stock begin? 111)
Norman transfers that has a $45,000 and a $105,000 FMV and $30,000 in money to Elnor Corporation in exchange for 50 shares of Elnor stock. The machinery, used in Norman's business, originally cost him $150,000 and is subject to a $84,000 liability which Elnor Corporation assumes. Kate exchanges $51,000 cash for the remaining 50 shares of Elnor stock. a. What are the amount and character of Norman's recognized gain or loss? b. What is his basis in the Elnor stock? c. What is basis in the machinery? d. What are the amount and character of Kate's recognized gain or loss? e. What is Kate's basis in the Elnor stock? f. When do Norman and Kate's holding periods for their stock begin? 111)
Test-Bank-Prentice-Halls-Federal-Tax-2010-23rd-Edition-Pope.docx