What is Bs capital gain from the transaction

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Question - AB Corporation has two shareholders, A and B.A owns 50 shares worth $5,000 (basis = $1,000) and B owns 50 shares worth $5,000 (basis = $1,000). The corporation distributes $3,000 to B in exchange for 30 shares. What are the tax consequences to B?

(a) What is B's capital gain (if any) from the transaction?

(b) With regard to 3'5 remaining shares in AB Corporation, what is his basis per share?

Reference no: EM132939037

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