Individual K has adopted an accounting policy for his sole proprietorship of expensing truck tires on its delivery trucks at the time that they are acquired. At the time K incorporates his sole proprietorship he transfers truck tires costing $15,000 and having a $10,000 fair market value to Jones in exchange for $10,000 of Jones common stock in a transaction qualifying under Sec. 351. 

How much income should K recognize?

Answer rating: 100% (QA)

When an individual incorporates his sole proprietorship it is considered ... View the full answer