Rhonda and Marta Form Blue Corporation

question 68

Multiple Choice

Rhonda and Marta form Blue Corporation. Rhonda transfers land (basis of $55,000 and fair market value of $180,000) for 50 shares plus $20,000 cash. Marta transfers $160,000 cash for 50 shares in Blue Corporation.

• A) Rhonda's basis in the Blue Corporation stock is $55,000.
• B) Blue Corporation's basis in the land is $55,000.
• C) Blue Corporation's basis in the land is $180,000.
• D) Rhonda recognizes a gain on the transfer of $125,000.
• E) None of the above.

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Definitions:

Ethnomethodological

Pertains to a sociological perspective focusing on the ways people produce and understand social order in everyday interactions.

Accounting

The organized documentation, accounting, and examination of monetary operations for a company or person.

Ethnomethodologists

Researchers who study how people use everyday interactions to construct a shared social reality.

Conversational Analyses

A method for studying the construction and patterns of social interaction within natural conversation.