Brad Forms Vott Corporation by Contributing Equipment, Which Has a Basis

question 121

Multiple Choice

Brad forms Vott Corporation by contributing equipment, which has a basis of $50,000 and an FMV of $40,000 in exchange for Vott stock. Brad also contributes $5,000 in cash. If the transaction meets the Sec. 351 control and ownership tests, what are the tax consequences to Brad?

• A) He recognizes a $10,000 loss.
• B) He recognizes a $5,000 gain and a $10,000 loss.
• C) He recognizes neither a gain nor a loss.
• D) He recognizes a $5,000 loss.

Identify the mechanisms of confirmation bias and self-concept maintenance.

Understand the impact of mental models on information processing.

Acknowledge the importance of diversity in breaking existing mental models.

Learn how social identity is formed through comparison and categorization.

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