Q:

Jed acquired 25 percent of the stock of Alpha Corporation (basis of $100,000) 12 years ago, and the other 75 percent was purchased by Zia (basis of $510,000) three years ago. Jed also holds a 10-year, $150,000 Alpha bond paying 6 percent interest.

Alpha enters into a tax-free consolidation with Beta Corporation, in which Jed may receive an 8 percent interest in the new AlphaBeta Corporation (value $144,000) plus $36,000 and Zia will receive a 27 percent interest (value $486,000) plus $54,000 of land. Alpha's basis in the land is $35,000. Jed also may exchange his $150,000 Alpha bond for a 10-year, $155,000 AlphaBeta bond paying 5.8 percent interest.

Before the distributions or reorganization to its shareholders, Alpha's value is $720,000, and Beta's value is $1,170,000.

If an amount is zero, enter "0".

a. What are Zia's and Jed's bases in their new AlphaBeta stock?

b. Evaluate the total amount of gain (loss) recognized by Jed, Zia, Alpha, and Beta on the reorganization?