On July 1, 2015, Grey Formed Arucaria Corporation

question 55

Multiple Choice

On July 1, 2015, Grey formed Arucaria Corporation. On that same date, Grey contributed $100,000 cash and transferred property with an adjusted basis of $60,000 to Arucaria in exchange for 3,000 shares of the corporation's common stock. The property transferred had a fair market value of $75,000 on the date of the transfer. Arucaria Corporation had no other shares of common stock outstanding on July 1, 2015. As a result of this transaction, Grey's basis in the stock and Arucaria Corporation's basis in the property (other than the cash) , respectively, are:

• A)$160,000 and $60,000
• B)$160,000 and $75,000
• C)$175,000 and $60,000
• D)$175,000 and $75,000
• E)None of the above

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Definitions:

Echoic Memory

Echoic memory refers to the auditory component of sensory memory, where sounds are briefly stored before they are processed.

Auditory Stimuli

Sounds or noises that initiate a response or reaction in the listener.

Effortful Processing

A type of information processing in the brain that requires a conscious effort and attention, unlike automatic processes.

Automatic Processing

Cognitive operations that occur without conscious thought, often quickly and effortlessly, such as recognizing faces or understanding words.