Question: Gearty and Fox organized Ace Corp., which issued voting common stock with a fair market value of $120,000. They each transferred property in exchange for

Gearty and Fox organized Ace Corp., which issued voting common stock with a fair market value of $120,000. They each transferred property in exchange for stock as follows: Property: Gearty: Building; Fox: Land Adjusted basis: Gearty: $40,000; Fox: $5,000 FMV: Gearty: $82,000; Fox: $48,000 % of Ace stock acquired: Gearty: 60%; Fox: 40% The building was subject to a $10,000 mortgage that was assumed by Ace. What was Ace's basis in the building?

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