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Taxation problem 1). A, an individual, transfers to Newco cash of 60,000 and a written...

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Accounting

Taxation problem

1). A, an individual, transfers to Newco cash of 60,000 and a written contract to provide services worth 40,000 to Newco. In exchange, Newco transfers to A 50 Newco common shares worth 100,000. B, an individual, transfers land with an adjusted basis of 70,000, fair market value of 100,000 to Newco. In exchange, Newco transfers to B 50 Newco common shares worth 100,000.

Describe all of the consequences to all of the parties.

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