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Business, 08.03.2021 19:40 Alphonse8472

Jed acquired 25% of the stock of Alpha (basis of $100,000) 12 years ago, and the other 75% was purchased by Zia (basis of $400,000) three years ago. Alpha enters into a tax-free consolidation with Beta, in which Jed will receive an 8% interest in the new AlphaBeta (value $90,000) plus $36,000 cash and Zia will receive a 28% interest (value $315,000) plus land worth $63,000. Alpha's basis in the land is $35,000. Before the reorganization or distributions to its shareholders, Alpha's value is $504,000 and Beta's value is $720,000. Required:
a. What is Jedâs and Ziaâs recognized gain or loss on the reorganization? What is each shareholderâs basis in his or her AlphaBeta stock?
b. What is Alphaâs and Betaâs recognized gain or loss on the reorganization?
c. Diagram the consolidation of Alpha and Beta Corporation.

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Jed acquired 25% of the stock of Alpha (basis of $100,000) 12 years ago, and the other 75% was purch...
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