Lark City (a government entity) donates landthat has a FMV of $800,000 and cash of$100,000 to Orange Corporation as aninducement to locate in the city. Four monthslater, Orange purchases additional land and abuilding at a cost of $500,000 and moves itsoperations to Lark City. Ann, the soleshareholder, contributes equipment (basis of$70,000 and fair market value of $200,000) tohelp Orange in its new operations in Lark City.What are the amounts to OrangeCorporation?1. gain recognized, if any;2. basis in land contributed by Lark City;3. basis in land/building purchased), and4. tax consequences of the contribution fromAnn to Orange Corporation?

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1. gain recognized, if any; 2. basis in land contributed by Lark City; 3. basis in land/building purchased), and

SWFT Comprehensive Volume 2019

42nd Edition

ISBN:9780357233306

Author:Maloney

Publisher:Maloney

Chapter17: Corporations: Introduction And Operating Rules

Section: Chapter Questions

Problem 39P

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