This Year D, E, and F Formed a New Corporation

question 13

Multiple Choice

This year D, E, and F formed a new corporation.D exchanged equipment worth $40,000 for 40 percent of the stock and services worth $15,000 for 15 percent of the stock.E exchanged machinery worth $30,000 for 30 percent of the stock and services worth $10,000 for 10 percent of the stock.F exchanged land worth $5,000 for 5 percent of the stock.Which of the following statements is true?

• A)F's transfer does not qualify for nonrecognition treatment under § 351 because he did not receive a sufficient equity interest.
• B)For § 351 purposes, D, E, and F are treated as owning only 75 percent of the stock and therefore their exchanges of property do not qualify for § 351 treatment.
• C)All of the property exchanges qualify for nonrecognition treatment under § 351.
• D)More than one of the above is true.
• E)None of the above is true.

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Definitions:

Hostility

Aggressive behavior or attitudes that can manifest from antipathy or conflict, often leading to adverse or harmful actions.

Employee Perceptions

The individual views and feelings that employees have about their workplace, role, and the organizational culture.

Stress Management

Techniques and strategies used to control stress levels for the promotion of overall well-being.

Coping Effectiveness

The degree to which an individual's strategies successfully manage or mitigate stress or hardship.