ABC corporation, a calendar year S corporation, with two 50% shareholders, provided you with the following information for 2019: Tax-exempt interest income $10,000 Sales $300,000 Depreciation recapture income $12,000 Long-term capital gain $40,000 Section 1231 gain $7,000 Cost of goods sold ($142,000) Administrative expense ($35,000) Depreciation expense ($47,000) Charitable contributions ($7,000) Distributions to shareholders $100,000 1-1-2019 AAA balance $60,000 1-1-2019 shareholder basis in stock $45,000 each ($90,000 total) 1-1-2019 OAA balance $4,000 Calculate ABC corporation’s AAA balance as of 12-31-2019.
ABC corporation, a calendar year S corporation, with two 50% shareholders, provided you with the following information for 2019: Tax-exempt interest income $10,000 Sales $300,000 Depreciation recapture income $12,000 Long-term capital gain $40,000 Section 1231 gain $7,000 Cost of goods sold ($142,000) Administrative expense ($35,000) Depreciation expense ($47,000) Charitable contributions ($7,000) Distributions to shareholders $100,000 1-1-2019 AAA balance $60,000 1-1-2019 shareholder basis in stock $45,000 each ($90,000 total) 1-1-2019 OAA balance $4,000 Calculate ABC corporation’s AAA balance as of 12-31-2019.
Chapter17: Corporations: Introduction And Operating Rules
Section: Chapter Questions
Problem 45P
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Question
ABC corporation, a calendar year S corporation, with two 50% shareholders, provided you with the following information for 2019:
| Tax-exempt interest income | $10,000 |
| Sales | $300,000 |
| $12,000 | |
| Long-term |
$40,000 |
| Section 1231 gain | $7,000 |
| Cost of goods sold | ($142,000) |
| Administrative expense | ($35,000) |
| Depreciation expense | ($47,000) |
| Charitable contributions | ($7,000) |
| Distributions to shareholders | $100,000 |
| 1-1-2019 AAA balance | $60,000 |
| 1-1-2019 shareholder basis in stock | $45,000 each ($90,000 total) |
| 1-1-2019 OAA balance | $4,000 |
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Calculate ABC corporation’s AAA balance as of 12-31-2019.
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