Jasmine Transferred 100 Percent of Her Stock in Woodward Company

question 19

Multiple Choice

Jasmine transferred 100 percent of her stock in Woodward Company to Jefferson Corporation in a Type A merger. In exchange, she received stock in Jefferson with a fair market value of $600,000 plus $400,000 in cash. Jasmine's tax basis in the Woodward stock was $1,500,000. What amount of loss does Jasmine recognize in the exchange and what is her basis in the Jefferson stock she receives?

• A)$500,000 loss recognized and a basis in Jefferson stock of $600,000
• B)$500,000 loss recognized and a basis in Jefferson stock of $1,100,000
• C)No loss recognized and a basis in Jefferson stock of $1,500,000
• D)No loss recognized and a basis in Jefferson stock of $1,100,000

---

Definitions:

Unicode Code

A character encoding standard that assigns a unique number for every character, no matter the platform, program, or language.

ASCII Code

A character encoding standard for electronic communication, representing text in computers by assigning a number to each symbol.

Toupper()

A function that converts a lowercase character to uppercase.

Uppercase Equivalent

Refers to the uppercase version of a given character or string, transforming all lowercase letters to their uppercase counterparts.