A Transfers Machines Valued at $170,000 (Basis = $150,000) Along

question 4

Multiple Choice

A transfers machines valued at $170,000 (basis = $150,000) along with $30,000 cash to AB Corporation and B transfers real property valued at $320,000 (basis = $310,000) to the corporation. A receives 40 percent of the outstanding stock and B receives 60 percent. B also receives $20,000 from the corporation. What is B's basis for his AB stock?

• A) $340,000
• B)$320,000
• C) $310,000
• D) $300,000

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Definitions:

Redistribute Income

The transfer of income from certain individuals or groups to others through mechanisms like taxes and welfare programs aimed at lessening income inequality.

Public-Sector Activity

Actions and services carried out by the government or governmental agencies for the public interest.

Political Process

The series of actions or steps taken in a structured manner to achieve governance or policy goals, often involving elections, decision making, and legislation.

Voters

Individuals eligible to participate in the election process to select public officials.