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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: Engineer who wrote (16514)	10/3/2000 9:59:09 AM
From: Ian@SI	Read Replies (1) \| Respond to of 21876

Normally, it's based upon book value. Specifically, what is your adjusted cost base for acquiring LU; Subtract 1/12th of that from the LU acb; the 1/12th becomes your new adjusted cost base for the AV shares. Current selling prices for either stock have nothing whatsoever to do with determining your cost base (unless of course you purchase more shares on the open market). What it has cost you to acquire your position is the relevant number.

To: Engineer who wrote (16514)	10/3/2000 10:23:42 AM
From: GVTucker	Respond to of 21876

Sometime this month you'll be getting an information package from Avaya. The company will send you the cash for the fractional shares of Avaya that you didn't receive, and will also inform you of the cost basis for your Avaya shares. You would need to subtract this from your cost of LU shares to get the adjusted cost basis for your LU shares.

To: Engineer who wrote (16514)	10/3/2000 11:10:21 AM
From: stock bull	Read Replies (1) \| Respond to of 21876

Hi Engineer & All, I found this posted on the LU Motley Fool thread. The Fool's page basically said the company will send us the formula. Note if you have the holding in a 401(k) or an IRA there will not be a tax problem and you can make an adjustment which you feel is representative of the transaction since you are using the tracker for reference only. What I did is as follows: Example based on 100 shares of LU bought at $38.00 which spun off 8 shares of AV (which I got added to my account @ $22.938 per share): Original cost of LU shares 100 x $38.00 = $ 3,800.00 Less 8 AV shares added to portfolio @ $22.938 = ($ 183.51) Total new cost basis for LU shares $ 3,616.49 This translates to a new price of $36.1649 per share for the LU shares. The new portfolio entries would be 100 shares of LU @ 36.1649 per share and 8 shares of AV at 22.938 per share. This method may be used temporarily as AV will let you know sometime in the future what the price will be for AV shares spun off from LU. You can revise your port at that time. In the meanwhile, you will have some starting point for both stocks. Hope this is helpful. The poster is "rbinck". I've used the above to figure out my LU cost basis and it seems to work fine. Stock Bull