Zeppo and Harpo Are Equal Owners of the Marx Corporation

question 55

Multiple Choice

Zeppo and Harpo are equal owners of the Marx Corporation. During the current year, they agree to admit Groucho as a shareholder. Groucho will contribute $25,000 in cash and property worth $50,000 (adjusted basis of $35,000) for 25% of Marx Corporation's stock. What is Groucho's basis in the Marx Corporation stock?

• A)$45,000
• B)$50,000
• C)$60,000
• D)$75,000
• E)$90,000

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Definitions:

Cache Memory

A type of fast, temporary storage in computing devices designed to speed up the retrieval of data by storing copies of frequently accessed information.

Registers

In computing, small, fast storage locations within the CPU that hold data to be processed, instructions for the processor, or the address of the next instruction.

RAM

Random Access Memory, a type of computer memory that is used to store the data and code currently being used by the processor.

Hardware Decisions

The process of choosing the specific physical components and technology for a computer or network system.