Rob and Fran Form Bluebird Corporation with the Following Investments

question 52

Multiple Choice

Rob and Fran form Bluebird Corporation with the following investments. Each receives 50% of Bluebird's stock.In addition,Fran receives cash of $40,000.One result of these transfers is that Fran has a:

• A)Recognized loss of $60,000.
• B)Recognized loss of $20,000.
• C)Basis of $460,000 in the Bluebird stock (assuming Bluebird reduces its basis in the land to $440,000).
• D)Basis of $400,000 in the Bluebird stock (assuming Bluebird reduces its basis in the land to $440,000).
• E)None of the above.

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Definitions:

Quantitative

Relating to, measuring, or measured by the quantity of something rather than its quality.

Epistemological

Pertaining to the theory of knowledge, including the methods, validity, and scope of understanding.

Ontological

Pertaining to the nature of being, existence, or reality, often considered within the branch of metaphysics dealing with the nature of what is.

Axiological

Relating to the branch of philosophy dealing with values, including those in ethics and aesthetics, as it pertains to research.