Fedora Bungarner started Bungamer Industries Ltd$.($BIL$)$ more than $20$ years ago. She initially acquired $110$ common shares for $$253,000$ and has not acquired any additional shares since, nor has she reduced her shareholding through redemptions or by any other means. The company has a December $31$ taxation year$-$end. As the business is running very smoothly, she would like to turn the administration of the business over to her twin sons, Charlie and Jack. The brothers are $32$ years old.Ms$.$ Bungarner would like to gift her BIL shares to her sons but is concerned about adverse income tax implications. She has heard a little about estate$-$freeze planning andbelieves that it could provide the solution. She has asked for your advice in this matter.In discussing this situation with Ms$.$ Bungarner, you have found that, while she wishes toretain control over BIL, she is prepared to have any future economic growth in the valueof the company accrue to the benefit of her two sons. You have learned that each of thesons is prepared to invest $$11,500$ of their own funds in the company. On July $1,2023,$ the condensed balance sheet of the company is as follows.Bungarner Industries Ltd$.$Balance Sheet as of July $1,2023$Tangible Assets $($Tax costs$)$ $ $12,488,000$Bank Loan $ $3,485,000$Common Shares $(110$ shares$)253,000$Retained Earnings $8,750,000$Total Debt and Shareholders' Equity $ $12,488,000$An independent appraiser has determined that the FMV of the tangible assets are equal to their tax costs. In addition, theappraiser concludes that the FMV of the goodwill is $$2,250,000.$ RequiredAdvise Ms$.$ Bungarner. Include in your solution the July $1,2023,$ balance sheet after your proposed share transactions. First, calculate the fair market value of Ms$.$ Bungarner's common shares.Tax cost of tangible assets Goodwill Less: Bank Loan Fair market value of common shares Part $2$Next, find the adjusted cost base $($ACB$)$ and paid$-$up capital $($PUC$)$ of Ms$.$ Bungarner's common shares.ACB of common shares PUC of common shares Part $3$What share transactions should Ms$.$ Bungarner enact? $($Select all that apply.$)$A$.$Add the ability to issue fixed$-$value preferred shares.B$.$Ms$.$ Bungarner can exchange all of her common shares for newly issued preferred shares that are redeemable for the value of the company's tangible assets.C$.$Ms$.$ Bungarner can exchange all of her common shares for newly issued preferred shares that are redeemable for the FMV of the shares upon approval.D$.$Reorganize the capital of the corporation by obtaining the necessary approvals and amending the articles of incorporation to add a new class of shares.E$.$Add the ability to issue preferred shares that can change in value.F$.$Once the exchange is complete, her two sons can each invest $ $11$ comma $500$ in exchange for common shares of BIL.Part $4$Next, calculate the ACB of the new preferred shares.ACB of old common shares Less: FMV of NSC ACB of new common shares Part $5$Now, calculate the required PUC reduction.Legal capitalNew preferred shares Less excess, if any, of:PUCOld common shares Less: FMV of NSC Excess Required PUC reduction Part $6$Find the ACB of the new preferred shares, the required PUC reduction, and the PUC of the new preferred shares.Legal capitalNew preferred shares Required PUC reduction PUC of new preferred shares Part $7$Now, work on the shareholders' equity portion of the balance sheet subsequent to the reorganization on July $1,2023.$ In this step, calculate the tax cost of the tangible assets after the reorganization.Tax cost of tangible assets before reorganization Amount invested by sons Tax cost of tangible assets after reorganization Part $8$Complete the shareholders' equity portion of the balance sheet subsequent to the reorganization on July $1,2023.$Bungarner Industries Ltd$.$Shareholders' EquityAs of July $1,2023$Tangible Assets $($Tax costs$)$ Bank Loan Preferred Shares Common Shares Retained Earnings Total Liabilities and Shareholders' Equity