Casey Transfers Property with a Tax Basis of $2,000 and a Fair

question 53

Multiple Choice

Casey transfers property with a tax basis of $2,000 and a fair market value of $5,000 to a corporation in exchange for stock with a fair market value of $4,000 and $400 in cash in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $600 on the property transferred. Casey also incurred selling expenses of $300. What is the amount realized by Casey in the exchange?

• A)$5,000
• B)$4,700
• C)$4,600
• D)$4,200

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Definitions:

Basic Need

Fundamental requirements vital for sustaining human life, such as food, water, shelter, and safety.

Clothing

Articles of attire worn on the body, typically consisting of fabrics or textiles but can also include items like shoes and accessories.

Schooling

A structured process of education and training provided at various levels such as elementary, secondary, and higher education institutions.

Medical Care

The services delivered by healthcare professionals to maintain, improve, or manage health.