Casey Transfers Property with a Tax Basis of $2,000 and a Fair

question 21

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 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