Tom incorporates his sole proprietorship as Total Corporation and transfers its assets to Total in exchange for all 100 shares of Total stock and four $10,000 interest-bearing notes. The stock has a $125,000 FMV. The notes mature consecutively on the first four anniversaries of the incorporation date. The assets transferred are as follows:

a. What are the amounts and character of Tom€™s recognized gains or losses?
b. What is Tom€™s basis in the Total stock and notes?
c. What is Total€™s basis in the property received from Tom?

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Assets Adjusted Basis FMV Cash S 5,000 S 5,000 S130,000 (70,000) 60,000 Minus: Accumulated depreciation Building Minus: Accumulated depreciation 90,000 S100,000 (49,000 51000 Land 24.000 30.000 Total $140,000 $165,000