Key Corporation Distributes a Patent with an Indeterminable Value to Gary

question 62

Multiple Choice

Key Corporation distributes a patent with an indeterminable value to Gary as part of a plan of complete liquidation. In addition, Gary receives $40,000 cash and land with a $70,000 FMV and a $30,000 adjusted basis. Gary's basis in the Key stock (a capital asset) surrendered is $120,000. If Gary relies on the open transaction doctrine, at the liquidation date he must recognize a

• A)$0 gain.
• B)$10,000 capital loss.
• C)$30,000 capital loss.
• D)$70,000 capital gain.

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Definitions:

Social Skills

The abilities necessary to effectively interact and communicate with others through verbal and non-verbal means.

Day Hospital

A medical facility offering outpatient care and treatment during daytime hours, allowing patients to return home at night.

Sheltered Workshop

A supervised workplace designed specially for people with physical or mental disabilities, aimed at providing a protective and supportive environment for vocational training and employment.

Operant Conditioning

A method of learning that employs rewards and punishments for behavior. Through operant conditioning, an association is made between a behavior and a consequence for that behavior.