Charlie Corporation transfers $700,000 stock and land with a value of $200,000 (basis of $95,000) to Sebago for most of its assets. The only asset not acquired in the "Type A" reorganization, a crane, is distributed to Sebago's shareholder, Betty. The crane is valued at $285,000 (basis of $300,000), and is subject to a $165,000 liability, which Betty assumes. Charlie stock and the land also are distributed to Betty in exchange for her stock in Sebago. Betty's basis in her stock is $630,000. What is the gain or loss recognized by Charlie, Sebago, and Betty on this restructuring? What is Betty's basis in the Charlie stock, land, and crane?

Rate of return douglas keel, a financial analyst for orange industries, wishes to estimate the rate of return for two similar-risk investments, x and y. douglas's research indicates that the immediate past returns will serve as reasonable estimates of future returns. a year earlier, investment x had a market value of $27 comma 000; and investment y had a market value of $46 comma 000. during the year, investment x generated cash flow of $2 comma 025 and investment y generated cash flow of $ 6 comma 770. the current market values of investments x and y are $28 comma 582 and $46 comma 000, respectively. a. calculate the expected rate of return on investments x and y using the most recent year's data. b. assuming that the two investments are equally risky, which one should douglas recommend? why?