Matt owns common shares of Maeb Inc. The adjusted cost base and paid-up capital of these shares is $300,000 and the FMV is $900,000. In the course of a capital reorganization, the following two packages of consideration were offered in exchange for the shares:

* Equal to retraction and/or redemption value.
REQUIRED
Indicate the tax consequences to Matt as a result of the above proposed reorganizations.

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S 10,000 80,000 600,000 210,000 S 500,000 300,000 (a) Cash. Bond FAⅣ* and LSC of Class A preferred shares FMV and LSC of Class B preferred shars.. (b) Cash.. FMV and LSC of Class A preferred shares. FMV and LSC of Class B preferred shares ....100,000