What is the amount and character of kathy realized

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Question - Kathy owns all the stock in Reed Corp. Her Reed stock has a basis of $90,000 and a fair market value of $150,000. Reed Corp is merged into Egan Corp. Pursuant to the reorganization, Kathy receives Egan preferred stock worth $50,000 and Egan common stock worth $100,000 in exchange for her Reed Corp. stock.

a) What is the amount and character of Kathy's realized and recognized gain?

b) What is Kathy's tax basis for her Egan Corp. preferred stock and common stock?

Reference no: EM132096361

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