Ms. Oasis owns some of the common shares of Capital Structure Ltd. with an adjusted cost base and paid-up capital of $1,200 and a fair market value of $3,700. In the course of a capital reorganization, Ms. Oasis exchanged all of her shares for the following package of consideration:

REQUIRED

Determine the tax consequences to Ms. Oasis as a result of the capital reorganization.

Transcribed Image Text:

Cash Notes (at fair market value) New preferred shares (at fair market value and LSC) New common shares (at fair market value and LSC) Total $500 1,500 1,000 700 $3,700