Question: Target Corporation holds assets with a FMV of $4,000,000 (A/B of $2,000,000). It transfers all of its assets to Acquiring Corporation in a "C" type reorganization for Acquiring Corporation stock worth $3,500,000 and $500,000 cash. Later Target Corp. distributes the Acquiring Corporation stock and the cash to Bill, its sole shareholder. Bill has an A/B in his Target stock of $700,000. a. How much gain must Target Corporation realize and recognize on the reorganization? b. What is Acquiring Corporation's A/B in the Target assets received in the reorganization? c. What is Bill's realized and recognized gain on the distribution?