Suzanne, Beth, Jackie, and Christine incorporate their psychiatry practice ("Babbling Lunatics, Inc.") with the following investments:

1. Suzanne contributes her copyright (basis of $59,000and FMV of $124,000) for 9500 shares of Lunatic stock, worth $81,000. The corporation also assumed her $43,000 of business debts.

1. Beth contributes her real estate(basis of $475,000, FMV of $271,000) in exchange for 9100 shares of Lunatic stock, worth $408,000, and received $93,000cash.

1. Jackie contributes her patent (basis of $280,000, FMV of $473,000) for 7300 shares of Lunatic stock, worth $373,000. The corporation also assumed her $100,000 mortgage, which Jackie took in order to pay her past due gambling losses.

1. Christine contributes accounting services to the corporation (basis of $0, FMV of $90,000) for 1,500 shares of Lunatic, Inc. stock, worth $90,000.

Calculate the following:

1) What is the percentage of ownership by the property contributing shareholder group?

2) Beth's realized and recognized gains, if any.

3) Jackie's recognized gain.

4) Suzanne's basis in her Lunatic stock.

5) Lunatic's basis in the real estate contributed by Beth.

6) Beth's basis in her Lunatic stock.

7) Lunatics' basis in the patent contributed by Jackie

Answer rating: 100% (QA)

1 Percentage of Ownership by the Property Contributing Shareholder Group Suzanne received 9500 shares Beth received 9100 shares Jackie received 7300 s... View the full answer