8 A and B organized Newco, Inc. A contributed a building with a basis of $40,000 and a FMV of $82,000 in exchange for 60% of the common stock. B contributed land with a basis of $5,000 and a FMV of$48,000 in exchange for 40% of its capital stock. The building contributed by A was subject to a $10,000 mortgage which Newco assumed. A's recognized gain on the exchange is: a. $0 b. $10,000 c. $42,000 d. $52,000

8. A and B organized Newco, Inc. A contributed a building with a basis of $40,000 and a FMV of $82,000 in exchange for 60% of the common stock. B contributed land with a basis of $5,000 and a EMV of $48,000 in exchange for 40% of its capital stock. The building contributed by A was subject to a $10,000 mortgage which Newco assumed. A's recognized gain on the exchange is: a. $0 b. $10,000 c. $42,000 d. $52,000