Heather and Howie Form HH Company

question 10

Multiple Choice

Heather and Howie form HH Company.In exchange for 50% of the stock,Heather contributes cash of $7,000.For the remaining 50%,Howie contributes a truck with a FMV of $7,000 (basis of $10,000) .Which of the following statements is correct?

• A)Howie will report a loss of $3,000.
• B)The basis of the truck to HH Company is $7,000.
• C)Howie will have a basis in his stock of $10,000.
• D)All of the statements are correct.

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Definitions:

Mother-In-Law

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A state of being tired, exhausted, or lacking energy, often as a result of prolonged stress or overwork.

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Behavior that is similar to suicide attempts but without a clear intention to cause death, often a cry for help or a sign of distress.

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The state of having mixed feelings or contradictory ideas about something or someone, often resulting in uncertainty or difficulty in making decisions.