Rachelle Transfers Property with a Tax Basis of $800 and a Fair

question 95

Multiple Choice

Rachelle transfers property with a tax basis of $800 and a fair market value of $900 to a corporation in exchange for stock with a fair market value of $750 and $50 in cash in a transaction that qualifies for deferral under §351. The corporation assumed a liability of $100 on the property transferred. What is Rachelle's tax basis in the stock received in the exchange?

• A)$900
• B)$850
• C)$750
• D)$700

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Definitions:

Corporate-Level

Pertaining to decisions, strategies, and processes that affect the entire organization, as opposed to those affecting only individual departments or regions.

Functional

Relating to the practical or useful aspects of something, especially its use or purpose.

Business-Level Strategies

The tactics and approaches a business adopts to compete effectively in a particular market, focusing on achieving competitive advantage.

Corporate Strategy

The overarching plan and scope of an organization aimed at achieving long-term business objectives and competitive advantage.