Julian Transferred 100 Percent of His Stock in Lemon Company

question 31

Multiple Choice

Julian transferred 100 percent of his stock in Lemon Company to Apricot Corporation in a Type B stock-for stock exchange. In exchange, he received stock in Apricot with a fair market value of $200,000. Julian's tax basis in the Lemon stock was $400,000. Whatamount of loss does Julian recognize in the exchange and what is his basis in the Apricot stock he receives?

• A) $200,000 loss recognized and a basis in Apricot stock of $200,000.
• B) $200,000 loss recognized and a basis in Apricot stock of $400,000.
• C) No loss recognized and a basis in Apricot stock of $400,000.
• D) No loss recognized and a basis in Apricot stock of $200,000.

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Definitions:

Prenatal Testosterone

The exposure to testosterone in the womb, which can influence various aspects of fetal development and future characteristics.

Gender Identity

An individual's personal sense of their own gender, which may or may not correspond with the sex they were assigned at birth.

Masculine Play

Activities or forms of play that are culturally or socially associated with traditional masculine roles or characteristics.

Gender

The social, cultural, and psychological aspects of masculinity and femininity.