ABC Company purchases all the assets of Johns Saw Shop. Details on basis and fair market values

ABC Company purchases all the assets of John’s Saw Shop. Details on basis and fair market values of John’s Saw Shop’s assets are as follows:

a. What is ABC’s basis in the assets purchased if ABC pays $40,000 for them?
b. What is ABC’s basis in the assets purchased if ABC pays $70,000 for them?
c. What is ABC’s basis if John’s Saw Shop is a corporation and ABC purchases all John’s stock for$60,000?

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Adjusted Basis $10,000 2,000 8,000 20,000 Fair Market Value $27,000 12,000 15,000 6,000 Asset Inventory Machinery& equipment Land Building