Sarah Transfers Property with an $80,000 Adjusted Basis and a $100,000

question 63

Multiple Choice

Sarah transfers property with an $80,000 adjusted basis and a $100,000 FMV to Super Corporation in a Sec. 351 transaction. Sarah receives stock with an $85,000 FMV and a short-term note with a $15,000 FMV. Sarah's basis in the stock is

• A)$100,000.
• B)$95,000.
• C)$85,000.
• D)$80,000.

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Definitions:

Liabilities

Financial obligations or debts that a company or individual owes, which must be settled over time.

Balance Sheet

A statement presenting a company’s financial standing, including details on assets, liabilities, and equity held by shareholders, at a particular point in time.

Total Assets

Total assets represent the sum of all resources owned by a company, valued in monetary terms, and listed on its balance sheet, including both current and non-current assets.

Liabilities

Financial obligations that a company owes to outside parties, including loans, accounts payable, mortgages, and other debts.