Solved by verified expert :93) Yolanda transfers land, a capital
asset, having a $70,000 adjusted basis and an $125,000 FMV plus $10,000 cash to
Jazz Corporation in exchange for all its stock. Jazz Corporation assumes the $100,000
mortgage on the land. The mortgage assumption has no tax avoidance purpose and
has the requisite business purpose. What is the amount of Yolanda’s realized
gain or loss? How much is recognized and what is its character? What is
Yolanda’s basis in the Jazz stock?
94) Zoe Ann transfers machinery having a
$36,000 adjusted basis and a $70,000 FMV for all 100 shares of Zeema
Corporation’s stock. Before the transfer, Zoe Ann used the machinery in her
business. She originally paid $50,000 for the machinery and claimed $14,000 of
depreciation before transferring the machinery. Zoe Ann recaptures no
depreciation on the transfer and the recapture potential is transferred to
Zeema Corporation. Zeema sells the machine for $66,000 after it had depreciated
the machine an additional $4,000. What is Zeema’s gain on the machine and what
is its character?
95) On July 9, 2008, Tom purchased a
computer (five-year property for MACRS purposes) for $6,000, which he used in
his sole proprietorship. He claimed $1,200 (0.20 × $6,000) of depreciation for
2008. On February 9, 2009, he transfers the computer and other assets of his
sole proprietorship to Brewer Corporation in exchange for Brewer stock in a
transfer qualifying under Sec. 351. What is the amount of depreciation for 2008
claimed by Tom? What is the amount of depreciation for 2009 claimed by Brewer
Corporation? What is Brewer’s basis in the computer on the date of transfer?
96) Reba, a cash basis accountant,
transfers all of the assets and liabilities of her practice to Able Corporation
in exchange for all of Able Corporation’s stock. The assets include $20,000 of
accounts receivable. What is the Corporation’s basis in the receivables? Will
the corporation be taxed on the receivables, as they are collected?
97) Ra Corporation issues a twenty-year
obligation at its $1,000 face amount. Rames purchases the obligation for $1,000
on the issue date. Due to a decline in interest rates, Ra calls the obligation
by paying $1,010 to each of the holders of the twenty-year obligations. What is
the tax treatment of the $1,010 by Ra and Rames?
