Tax Drill - Basis Adjustment
In a transaction qualifying under § 351, Kelcy transfers the following assets to Connor Corporation in exchange for all of its stock: equipment (basis $200,000; fair market value $180,000), land (basis $65,000; fair market value $80,000) and machinery (basis $100,000; fair market value $95,000). The alternative approach is not elected.
Connor Corporation has a basis of: $__________ in the equipment, $__________ in the land, and $__________ in the machinery. Kelcy recognizes __________ on the transfer. Kelcy's has a basis of $__________ for his stock.