Max Transfers the Following Properties to a Newly Created Corporation

question 28

Multiple Choice

Max transfers the following properties to a newly created corporation for $90,000 of stock and $10,000 cash in a transaction that qualifies under Sec.351. Max's recognized gain is

• A) $3,000.
• B) $5,000.
• C) $7,000.
• D) $10,000.

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Definitions:

Span Of Control

The number of subordinates directly reporting to a manager.

Subordinates

Employees or team members who are under the direction and control of a senior manager or supervisor in an organizational hierarchy.

Manager

A person responsible for controlling or administering an organization or group of staff, focusing on achieving goals through directing efforts and resources.

Chain Of Command

The formal line of authority, communication, and responsibility within an organization.