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:

Minority Group

A group of people who, due to their physical or cultural characteristics, are singled out from the others in the society in which they live for differential and unequal treatment.

Sociologists

Scientists who study the development, structure, and functioning of human society, including social relationships, institutions, and behaviors.

Prejudice

A preconceived opinion or judgment, often grounded in irrational bias or stereotypes, against a person or group.

Discrimination

The unjust or prejudicial treatment of different categories of people, especially on the grounds of race, age, or sex.