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Marcus contributes property with an adjusted basis of $80,000 and a fair market value of $100,000 to a newly formed business entity. If the entity is an S corporation and the transaction qualifies under § 351, the S corporation's basis for the property and the shareholder's basis for the stock are:

Asset Basis Stock Basis

a. $ 80,000 $100,000

b. $100,000 $ 80,000

c. $ 80,000 $ 80,000

d. $100,000 $100,000

e. None of the above.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9413738

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