Carlos Transfers Property with a Tax Basis of $500 and a Fair

question 77

Multiple Choice

Carlos transfers property with a tax basis of $500 and a fair market value of $800 to a corporation in exchange for stock with a fair market value of $650 and $50 in a transaction that qualifies for deferral under section 351. The corporation assumed a liability of $100 on the property transferred. What is the corporation's tax basis in the property received in the exchange?

• A) $800
• B) $600
• C) $550
• D) $450

---

Definitions:

Operant Conditioning

A system of conditioning that impacts the strength of behaviors through positive reinforcements or negative consequences.

Observational Learning

The process by which an individual learns by observing the actions and outcomes of others' behaviors.

Classical Conditioning

A learning process that involves associating an involuntary response and a stimulus.

Insight Learning

Insight learning is the process of learning how to solve a problem or do something new by applying what is already known, involving an 'aha' moment of understanding.