Roy Transfers Property with a Tax Basis of $800 and a Fair

question 14

Multiple Choice

Roy transfers property with a tax basis of $800 and a fair market value of $500 to a corporation in exchange for stock with a fair market value of $400 and $50 in cash in a transaction that qualifies for deferral under §351. The corporation assumed a liability of $50 on the property transferred. What is Roy's tax basis in the stock received in the exchange?

• A)$800
• B)$750
• C)$700
• D)$500