Cherie Transfers Two Assets to a Newly-Created Corporation

question 92

Multiple Choice

Cherie transfers two assets to a newly-created corporation. The first asset has an adjusted basis of $40,000 and an FMV of $50,000. The second asset has an adjusted basis of $35,000 and an FMV of $25,000. Cherie receives stock with an FMV of $66,000 and $9,000 cash. Cherie must recognize a gain of

• A)$10,000.
• B)$6,000.
• C)$5,000.
• D)$4,000.

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Definitions:

Altered

Changed in form, character, or function.

Turgor Pressure

The pressure exerted by water inside the cell against the cell wall, crucial for maintaining plant structure and rigidity.

Pressure Gradient

A physical quantity representing the rate of pressure change in space, directing fluid flow from high to low pressure areas.

Concentration Gradient

A variation in the concentration of a substance across a space, leading to diffusion or active transport phenomena.