Danny and Jasmine Form a Business Entity with Danny Contributing

Multiple Choice

Danny and Jasmine form a business entity with Danny contributing cash of $80,000 and Jasmine contributing land which has a basis of $65,000 and a fair market value of $80,000.At the end of the first year of operations, the business entity has earned a profit of $50,000 and has outstanding liabilities of $20,000.Which of the following statements are correct?

A) If the entity is an S corporation, Jasmine's stock basis at the end of the first year is $90,000.
B) If the entity is a partnership, Jasmine's basis for her partnership interest at the end of the first year is $65,000.
C) If the entity is a C corporation, Jasmine's stock basis at the end of the first year is $80,000.
D) All of the above.
E) None of the above.