Jane Transfers Property (Basis of $180,000 and Fair Market Value

question 50

Multiple Choice

Jane transfers property (basis of $180,000 and fair market value of $500,000) to Green Corporation for 80% of its stock (worth $425,000) and a long-term note (worth $75,000) , executed by Green Corporation and made payable to Jane. As a result of the transfer:

• A) Jane recognizes no gain.
• B) Jane recognizes a gain of $75,000.
• C) Jane recognizes a gain of $270,000.
• D) Jane recognizes a gain of $320,000.
• E) None of the above.

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