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

question 14

Multiple Choice

Roy transfers property with a tax basis of $800 and a fair market value of $500 to a corporation in exchange for stock with a fair market value of $400 and $50 in cash in a transaction that qualifies for deferral under §351. The corporation assumed a liability of $50 on the property transferred. What is Roy's tax basis in the stock received in the exchange?

• A)$800
• B)$750
• C)$700
• D)$500

---

Definitions:

Misleading Statement

A statement or claim that provides false, inaccurate, or deceptive information intended to manipulate or deceive.

Leadership Models

Models that describe different approaches and styles used by leaders to guide, motivate, and manage teams.

Theory X/Theory Y

A concept of human motivation and management developed by Douglas McGregor, describing two contrasting models of workforce motivation and behavior.

Traits Model

A psychological theory that attributes personality to a set of stable and enduring characteristics or traits possessed by individuals.