In a transaction that qualifies under Section 351, Buster transfers an asset with a basis of $50,000 and a fair market value of $80,000 to Bronco, Inc. in exchange for Bronco common stock. The asset is encumbered by a $75,000 liability, which Bronco assumes. The liability was incurred many years ago to acquire the asset being transferred. Buster owns 100% of Bronco, Inc. Buster must recognize a gain on this transaction of:

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On january 2, well co. purchased 10% of rea, inc.’s outstanding common shares for $400,000, which equaled the carrying amount and the fair value of the interest purchased in rea’s net assets. well did not elect the fair value option. because well is the largest single shareholder in rea, and well’s officers are a majority on rea’s board of directors, well exercises significant influence over rea. rea reported net income of $500,000 for the year and paid dividends of $150,000. in its december 31 balance sheet, what amount should well report as investment in rea?

At the end of the current year, accounts receivable has a balance of $550,000; allowance for doubtful accounts has a credit balance of $5,500; and sales for the year total $2,500,000. an analysis of receivables estimates uncollectible receivables as $25,000. determine the net realizable value of accounts receivable after adjustment. (hint: determine the amount of the adjusting entry for bad debt expense and the adjusted balance of allowance of doubtful accounts.)