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Cornell purchased a 15 year $25000 bond from Fulvous Corporation for $20 000 eight years ago Interest of $2300 has been amortized over the eight years and added to Cornells bond basis In the

Cornell purchased a 15-year, $25,000 bond from Fulvous Corporation for $20,000 eight years ago. Interest of $2,300 has been amortized over the eight years and added to Cornell's bond basis. In the current year, Fulvous is acquired by Glaucous in a “Type A” reorganization. Cornell exchanges his Fulvous bond for a 7-year, $27,000 Glaucous bond.

Complete the statement below that outlines how Cornell should treat this exchange for income tax purposes.

Cornell has a $________ realized gain of which $_________ is recognized. His basis in the 7-year Glaucous bond is
$________.

 

Apr 10 2020 View more View Less

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