Sparrow Corporation Purchased 90% of the Stock of Warbler Corporation

True/False

Sparrow Corporation purchased 90% of the stock of Warbler Corporation eight years ago for $1 million. In the
current year, Sparrow liquidates Warbler and acquires assets with a basis to Warbler of $850,000 (fair market value of
$1.2 million). Sparrow will have a basis in the assets of $850,000 (Warbler's basis in the assets), and no recognized gain or loss.