Under the provisions of ITA 85(1), Jason transferred a piece of land he held personally to a corporation in which he owned all of the shares. The adjusted cost base of the land was $120,000 and, at the time of the transfer, it had a fair market value of $390,000. The transfer took place at an elected value of $120,000. As consideration, Jason received a promissory note for $60,000, preferred shares with a fair market value of $210,000, and common shares with a fair market value of $120,000. Which one of the following is the adjusted cost base of the preferred shares (first)and the adjusted cost base of the common shares (second)?
A)Nil and $60,000.
B)$60,000 and Nil.
C)$38,181 and $21,819.
D)$210,000 and $120,000.

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The Answer of Under the provisions of ITA 85(1), Jason transferred a piece of land he held personally to a corporation in which he owned all of the shares. The adjusted cost base of the land was $120,000 and, at the time of the transfer, it had a fair market value of $390,000. The transfer took place at an elected value of $120,000. As consideration, Jason received a promissory note for $60,000, preferred shares with a fair market value of $210,000, and common shares with a fair market value of $120,000. Which one of the following is the adjusted cost base of the preferred shares (first)and the adjusted cost base of the common shares (second)?
A)Nil and $60,000.
B)$60,000 and Nil.
C)$38,181 and $21,819.
D)$210,000 and $120,000.

Under the Provisions of ITA 85(1), Jason Transferred a Piece