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The City of Boston Made a Capital Contribution of Land

Question 115

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The City of Boston made a capital contribution of land to Fenway Company as an inducement to the company to build a manufacturing plant in the city.The land was valued at $500,000 at the time of the contribution.What gain, if any, does Fenway recognize on the contribution and what is Fenway's basis in the land?

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$500,000 income.$500,000 basis...

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