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Four Individuals Form Chickadee Corporation Under § 351

Question 60

Multiple Choice

Four individuals form Chickadee Corporation under § 351. Two of these individuals, Jane and Walt, made the following contributions: Four individuals form Chickadee Corporation under § 351. Two of these individuals, Jane and Walt, made the following contributions: Both Jane and Walt receive stock in Chickadee Corporation equal to the value of their investments. A) Jane must recognize income of $40,000; Walt has no income. B) Neither Jane nor Walt recognize income. C) Walt must recognize income of $130,000; Jane has no income. D) Walt must recognize income of $100,000; Jane has no income. E) None of the above. Both Jane and Walt receive stock in Chickadee Corporation equal to the value of their investments.


A) Jane must recognize income of $40,000; Walt has no income.
B) Neither Jane nor Walt recognize income.
C) Walt must recognize income of $130,000; Jane has no income.
D) Walt must recognize income of $100,000; Jane has no income.
E) None of the above.

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