eBook Exercise 13-2 (Algorithmic) (LO. 3) On January 1 of the current year, Rhondell Corporation holds accumulated E & P of $200,000. Current E & P for the year is $600,000, earned evenly throughout the year. Elizabeth and Jonathan are the sole equal shareholders of Rhondell from January 1 to April 30. On May 1, Elizabeth sells all of her stock to Marshall. Rhondell makes two distributions to shareholders during the year: a total of $320,000 ($160,000 to Elizabeth and $160,000 to Jonathan) on April 30 and a total of $560,000 ($280,000 to Jonathan and $280,000 Marshall) on December 31. Determine the allocation of the distributions by completing the table below. Assume that the shareholders have sufficient basis in their stock for any amount that is treated as return of capital. If an amount is zero, enter "0". If required, round any division to two decimal places and use in subsequent computations. Round final answers to the nearest dollar. Total Distribution April 30, $320,000 cash December 31, $560,000 cash From Current From Accumulated E & P 222 Check My Work 1 more Check My Work uses remaining. E & P Return of Capital 0 0

eBook Exercise 13-2 (Algorithmic) (LO. 3) On January 1 of the current year, Rhondell Corporation holds accumulated E & P of $200,000. Current E & P for the year is $600,000, earned evenly throughout the year. Elizabeth and Jonathan are the sole equal shareholders of Rhondell from January 1 to April 30. On May 1, Elizabeth sells all of her stock to Marshall. Rhondell makes two distributions to shareholders during the year: a total of $320,000 ($160,000 to Elizabeth and $160,000 to Jonathan) on April 30 and a total of $560,000 ($280,000 to Jonathan and $280,000 Marshall) on December 31. Determine the allocation of the distributions by completing the table below. Assume that the shareholders have sufficient basis in their stock for any amount that is treated as return of capital. If an amount is zero, enter "0". If required, round any division to two decimal places and use in subsequent computations. Round final answers to the nearest dollar. Total Distribution April 30, $320,000 cash December 31, $560,000 cash From Current From Accumulated E & P 222 Check My Work 1 more Check My Work uses remaining. E & P Return of Capital 0 0

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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