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Please complete the following the multiple choice and provide explanation for the two questions 7. During...

Please complete the following the multiple choice and provide explanation for the two questions

7. During the year,R,S,T and U formed a new corporation. R contributed appreciated property, S and T contributed cash and U contributed services. R, S, T and U each received 25% of the stock. Based on the facts :_____ a. R must report taxable income b. R and U must report taxable income c. U must report taxable income d. None of the parties must report taxable income

8. As part of a reorganization, S received the following in exchange for a share of stock with a $75 basis: One share of stock worth $50 and cash of $20 What is S’s recognized gain or loss on this exchange?______ a. $25 loss b. $20 gain c. $5 loss d. No gain or loss is recognized

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7. During the year,R,S,T and U formed a new corporation. R contributed appreciated property, S and T contributed cash and U contributed services. R, S, T and U each received 25% of the stock. Based on the facts :-

c. U must report taxable income.

8. As part of a reorganization, S received the following in exchange for a share of stock with a $75 basis: One share of stock worth $50 and cash of $20 What is S’s recognized gain or loss on this exchange:-

d. No gain or loss is recognized

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