Assuming the fair market value of dexter corporation stock


Question - Alan, Baker and Crowe formed Dexter Corporation during 2011. Pursuant to the incorporation agreement, Alan transferred property with an adjusted basis of $30,000 and a fair market value of $45,000 for 450 shares of stock, Baker transferred cash of $35,000 in exchange for 350 shares of stock, and Crowe performed services valued at $25,000 in exchange for 250 shares of stock. Assuming the fair market value of Dexter Corporation stock is $100 per share, what is Dexter Corporation's tax basis for the property received from Alan?

a. $0

b. $30,000

c. $45,000

d. $65,000

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Accounting Basics: Assuming the fair market value of dexter corporation stock
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