Individuals Terry and Jim Form TJ Corporation

question 68

Multiple Choice

Individuals Terry and Jim form TJ Corporation.Terry transfers cash of $930,000 in exchange for 50% of the stock of the TJ Corporation worth $900,000 and a $30,000 note.Jim transfers equipment with a $890,000 adjusted basis and a $930,000 FMV for 50% of the stock worth $900,000 and a note of the TJ Corporation valued at $30,000.The basis of the equipment to TJ Corporation is

• A)$890,000.
• B)$920,000.
• C)$940,000.
• D)$960,000.

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Definitions:

Auction

A sale that is open to the public, during which potential buyers compete for the right to purchase certain items by placing higher and higher bids until the highest bid is reached and the auctioneer accepts on behalf of the seller.

First Customer

The term "first customer" refers to the initial purchaser of a company's product or service, marking a significant milestone for a new business or product launch.

Without Reserve

An auction term indicating that an item is sold to the highest bidder without any minimum price or reserve.

Enforceable Agreement

A contract or agreement that can be legally imposed or upheld by a court of law.