ABC Corporation (an S Corporation) had an ordinary loss of $365,000 for 2017 (which has 365 days in 2017). A and B were 50/50 equal shareholders from January 1, 2017 to January 31, 2017. On January 31, 2017, A sold his stock to C. what is the total loss allowable to B?

ABC Corporation (an S Corporation) had an ordinary loss of $365,000 for 2017 (which has 365 days in 2017). A and B were 50/50 equal shareholders from January 1, 2017 to January 31, 2017. On January 31, 2017, A sold his stock to C. what is the total loss allowable to B?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: On January 1, 2022, Kinney, Inc., an S corporation, reports $32,800 of accumulated E & P and a…

A: Accumulated adjustments account (AAA): It refers to a corporation's account that tracks adjustments…

Q: Rossow purchased 1,900 shares of Reimer on July 12, 2021, for $72,200; Reimer reported $45,000 net…

A: Equity method of accounting investment is used when the ownership is more than 20% .Equity Method of…

Q: In 2019, Gerry , Inc. issued $1 par common stock for $35 per share. No other common stock…

A: Treasury Stock is a common stock of the company who purchased them from the open market. The…

Q: stributed $10,000 to Terry, its sole shareholder, on May 1, 2022. Terry’s stock basis in Cane…

A: A dividend refers to the sum value of money distributed by a company to its shareholders from the…

Q: At the beginning of the current year, Brou Inc. sells all of its assets and pays its liabilities.…

A: Deemed dividend is the part of dividend that is not actually paid but treated as dividend for the…

Q: Daniel is the sole shareholder in Helio, Inc., a calendar-year corporation. After operating as a C…

A: Introduction: An individual, company, or organisation that owns stock in a company is a shareholder.…

Q: Munson and Sons (MS) owns 32% of Harrington Corp. During 2022, Harrington reported a net income of…

A: The equity method is an accounting approach where an investor recognizes its share of an investee's…

Q: ! Required information [The following information applies to the questions displayed below.] This…

Q: Can A recognize the $25,000 loss in 2016? How much loss will A recognize on the IBM calls in 2017?…

A: Here, in the example, A has made loss on two counts. The 1st loss is incurred when the shares…

Q: Gg.93. This year Jack O. Lantern incurred a $65,000 loss on the worthlessness of his stock in the…

A: As per section 1244 one can claim upto $50,000/- as ordinary loss instead of capital loss. In case…

Q: ruary 2019, Sierra paid $4,500 to acquire 150 shares of CGL stock. In December 2021, CGL declared a…

A: Basis is the amount of paid for shares and it is cost paid for acquisition of shares and basis…

Q: Griffey Corporation has 22,000 of accumulated EP and incurs a loss of $12,000 for the year. The loss…

A: Profits available for dividend distribution=Accumulated Earnings and profits - Loss of the…

Q: Bravo, Incorporated, owns all of the stock of Echo, Incorporated. For 2024, Bravo reports Income…

A: If the company's securities such as bonds or debentures are convertible then the earnings per share…

Q: Superior Company owns 40% of the outstanding stock of Bernard Company. During 2016, Bernard paid a…

Q: On January 1, 2020, Leo paid $15,000 for 5 percent of the stock in BLS, an S corporation. In…

A: Gain = Loan repaid - Carrying amount of Loan

Q: ABC Corp. had accumulated earnings and profits as of January 1, 2021 equal to $17,000. For the…

A: The objective of the question is to determine the amount and character of the distributions received…

Q: Sabres Limited, a Canadian- controlled private corporation whose fiscal year end is December 31,…

A: Answer - Effect on Income: Particulars Amount Investments: ACL 1/2 ´…

Q: Chandra was the sole shareholder of Pet Emporium, which was originally formed as an S corporation.…

A: The objective of the question is to determine the amount of the suspended loss that Chandra can…

Q: Chandra was the sole shareholder of Pet Emporium, which was originally formed as an S corporation.…

A: The objective of the question is to determine the amount of the suspended loss Chandra is allowed to…

Q: Haynes, Inc., obtained 100 percent of Turner Company’s common stock on January 1, 2017, by issuing…

A: Consolidated financial statements are prepared when a company acquired more than 50% stocks of…

Q: Net capital loss carry-over from 2019 is $30, Non capital loss carry-over from 2019 is $70 Required…

A: Pay as you earn system or tax deduction at source in some countries are the advance tax payment…

Q: Chandra was the sole shareholder of Pet Emporium, which was originally formed as an S corporation.…

A: The objective of the question is to determine the amount of the suspended loss that Chandra can…

Q: Pop Corp owns 200 shares of stock in Small Corp, which represents 35% in Small Corp. The value of…

A: Pop Corp owns 35% in Small Corp that is 200 shares of stock = $100 Market value = $500 End of 2021,…

Q: Mr. Watson had the following share transactions during 2021. Mr. Watson is not generally active in…

A: In the context of the given question, we are required to compute taxable capital gains or allowable…

Q: Haynes, Inc., obtained 100 percent of Turner Company’s common stock on January 1, 2017, by issuing…

A: Retained earning is the amount kept by the company for the future growth purpose.

Q: am. 133.

A: To determine the correct capital loss carryover for Jack and Jill, it is crucial to follow the tax…

Q: Simmons Corporation owns stock of Armstrong, Inc. Prior to 2017, the investment was accounted for…

A: The dividend revenue of $8,000 is obtained by multiplying the net income of $80,000 with the…

Q: These questions are based on the following information and should be viewed as independent…

A: The amount of money that a business gets from shareholders over and above the par value of its…

Q: What gain and net reduction in retained earnings would result from this property dividend?

A: Answer: To calculate the gain and net reduction in retained earnings resulting from the property…

Q: In 2010, Stephan formed a calendar-year C-corporation. In 2017, Stephan realized that his interests…

A: Capital Gain- Capital gains are the increases in the value of an asset or investment over time.

Q: How much goodwill is inherent in the purchase price? Give any required entries for Investor…

A: Goodwill is the intangible asset which is held by one company upon the acquisition or the purchase…

Q: A Corp. was incorporated in 2017. In 2019, Abel transferred machinery worth $200,000 (basis of…

A: The capital is the backbone of the company, and the company will be willing to raise the capital for…

Q: In 2023, Unlimited Tech had net operating income of $7,613,386. In addition to their operating…

A: It is the income of a taxpayer on which the revenue authorities will impose tax. The taxable income…

Q: Paul, Inc. owns 75% of the voting stock of Booker Corp., and the two companies are consolidated in…

A: Under the consolidation method, a parent company combines its own revenue with 100% of the revenue…

Q: During the year, an S corporation incurs a $100,000 net operating loss. Maggie, the sole…

A: The choice of the correct option will be based on Maggie's stock basis.

Q: CB Corporation was formed as a calendar-year S corporation. Casey is a 60 percent shareholder and…

A: The company may use the daily method of allocating income, The income of shareholders is allocated…

Q: On January 1, 2023, Kinney, Inc., an S corporation, reports $4,000 of accumulated E & P and a…

A: Accumulated adjustments account (AAA):It refers to a corporation's account that tracks adjustments…

Q: e sole shareholder in Helio, Inc., a calendar-year corporation. After operating as a C corporation…

A: Taxation - The term "taxation" refers to the process through which a taxing authority, typically a…

Q: Melanie is the sole stockholder of Machine Inc., an S corporation. Her basis in the stock as of the…

A: Overall basis = stock basis + debt basis

Q: 1) Oman LLC is a company with a December 31 year end. On January 1, 2015, the company acquires 3,000…

Q: Am. 112.

A: PART BJune 15: N/ASeptember 30: DividendExplanation of Solutions:June 15th Distribution:• Dividend:…

Q: ABC was formed as a calendar-year S corporation with Alan, Brenda, and Conner as equal shareholders.…

A: According to daily allocation method, Period income from January 01 to December 31 is allocated…

Q: On January 1, 2017, Leo paid $15,000 for 5 percent of the stock in BLS, an S corporation. In…

A: It is the original cost of an asset, adjusted for any changes in its value over time due to certain…

Q: 00 in 2017. 70 shares for $2,250 in 2018. 80 shares for $2,675 in 2019. They sold 160 shares of…

A: Answer :The basis used in the sale of share is FIFO basis. In FIFO method it is assumed that first…

Q: 2) Pike Corporation paid $100,000 for a 10% interest in Salmon Corp. on January 1, 2013, when…

A: Journal entries are a record of the business transaction in the books of business.Balance of…

Q: Chandra was the sole shareholder of Pet Emporium, which was originally formed as an S corporation.…

A: The objective of the question is to determine the amount of the suspended loss that Chandra can…

Q: On January 1, 2023, Kinney, Inc., an S corporation, reports $33,600 of accumulated E & P and a…

A: Accumulated adjustments account (AAA): It refers to a corporation's account that tracks adjustments…

Concept explainers

Fringe Benefit Tax

Fringe benefits are in addition to the compensation that companies give to their employees. It is an additional benefit above the stated salary. It helps to keep the employees of the firm motivated as sometimes the only salary is not enough to retain the quality employees of the firm. There are different types of fringe benefits. Fringe benefits are given in both private as well as public enterprises.

Question

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1 Introduction

VIEW

Step 2 Calculating the required part

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

Sapphire Jewellery Pty Ltd (SJ) is a resident private company. During the 2023 income year, SJ recorded an accounting profit of $80,000 In addition to the transactions recorded in the financial statements, SJ noted the following: SJ sold shares held as an investment for $45,000. The shares were purchased in 2017 for $ 25,000 Calculate the taxable income of SJ for the 2023 income year. Question 2Select one: $100,000 $ 90,000 $60,000 $70,000
ABC owns 29% of XYZ Corp. During 2020, XYZ reported a net income of $415,000 and did not declare any dividends. Additionally, XYZ sold a piece of land, with a carrying value of $140,000 to ABC for $345,000. ABC still holds the land. ABC accounts for its investment in XYZ Corp using the equity method. Required: On December 31, 2022, a journal entry is required to record the impact of the above transactions. What is the net debit to the Investment in XYZ Corp account / the net credit to the Equity Income.
This year Barney purchased 440 shares of Bell common stock for $16.50 per share. At year-end the Bell shares were only worth $3.30 per share. What amount can Barney deduct as a loss this year?
The Brush Cherry Corporation has a $75,000 loss from operations (excluding dividends received) for 2019, and dividends of $150,000 received from 30 percent-owned domestic corporations. How much is the Brush Cherry Corporation's dividends received deduction for 2019? a.$45,000 b.$97,500 c.$120,000 d.$75,000 e.None of the amounts listed are correct.
Landry owns 50 of 250 outstanding shares of Kelly Manufacturing corporation. How many of Landry’s shares must be redeemed in order for the redemption to qualify as disproportionate? Assume that Kelly Manufacturing corporation has $100,000 in current earnings & profits, has no accumulated e&p, and there were no dividends or other distributions this year. If Landry’s stock is redeemed for $15,000 on December 31, what is the effect on earnings and profits?
Rohan Limited is a privately owned company and has 31 December year-end. The company elected to apply ASPE for its financial reporting. On January 1, 2017, Rohan Limited purchased 30 shares of the 100 outstanding common shares of another privately held company, Bassett Company, for $165,000 cash. Rohan Limited has significant influence as a result of this acquisition. At that date, the statement of financial position of Bassett Company reflected the following: Non-depreciable assets $155,400 (fair value, $199,000); Depreciable assets (net), $178,000 (fair value, $250,000); and Total liabilities, $101,900 (book value equaled fair value); The depreciable assets had remaining useful life of 5 years and had been depreciated using straight-line method. On December 31, 2017, Bassett Company reported net income of $88,400. Bassett Company also declared and paid cash dividend in the amount of $20,000 on December 31, 2017. Goodwill was not impaired over the time period in question. Required:…
6. Binat died on March 13, 2018, leaving the following properties: Ordinary shares of ABC Corporation (2,500 shares) - listed in the Philippine Stock Exchange(highest - P40; lowest - P39. Ordinary shares of XYZ Corporation (1,500 shares) - not listed in the stock exchange: Cost - P50 per share; book value - P45 per share. Preference shares of OPQ Incorporated (3,000 shares) - not listed in the stock exchange. Cost - P70 per share, book value - P65 per share, par value - P45 per share. Car (cost - P600,000; book value - P300,000; market value - P350,000) Real properties (zonal value - P140,000, assessed value P80,000) Compute for the gross estate of Binat?
Genny, Inc. received $80,000 in dividends during 2007 from its stock investment in Cary Company. How much of the dividends are excluded from Genny's taxable income? Select one: a. $56,000 b. $24,000 C. $80,000 d. None
1.(3)
Moosa LLC is a company with a December 31 year end . On January 1, 2014, the company acquires 1000 shares of Mubarak LLC at a cost of OMR 10 per share. Transaction costs total OMR 100. The investment does not give Moosa LLC influence over , or control of Mubarak LLC . Moosa LLC classifies these shares as held for trading . On December 31, 2014, the fair value of the Mubarak LLC shares has increased to OMR 15 per share. The Mubarak LLC shares did not declare or pay any dividends during 2014 On March 1, 2015 , Moosa LLC sells all of the Mubarak LLC shares for OMR 18 per share. Transaction costs the disposal are OMR 150.Prepare Journal Entries in the books of Ismail LLC
Five years ago, Gerald invested $122,000 in a passive activity, his sole investment venture. On January 1, 2018, his amount at risk in the activity was $24,400. His shares of the income and losses were as follows: Year Income (Loss) 2018 ($36,600) 2019 (24,400) 2020 44,400 Gerald holds no suspended at-risk or passive activity losses at the beginning of 2018. If an answer is zero, enter "0". a. If losses were limited only by the at-risk rules, how much can Gerald deduct in 2018 and 2019? Year Loss Allowed Suspended 2018 ($36,600) 2019 ($24,400) Total
On January 1, 2020, Leo paid $15,000 for 5 percent of the stock in BLS, an S corporation. In November, he loaned $8,000 to BLS in return for a promissory note. BLS generated a $600,000 operating loss in 2020. BLS generated $220,000 ordinary business income in 2020. In 2022, BLS repaid its $8,000 debt to Leo before he restored any basis in the debt. A) How much gain or loss, if any, will Leo recognize as a result of the debt repayment?