Global Corporation distributed property with an $213,000 fairmarket value and a $117, 150 adjusted basis to one of itsshareholders. The property was subject to a $64, 433 mortgage,which the shareholder assumed. Global has ample E & P to coverany distribution made during the year.What is the amount of the shareholder's dividend income on thedistribution?$fill in the blank 1What is the shareholder's basis in the property received?$fill in the blank 2

Step 1: Given the information.Fair market value = $213,000Adjusted value = $117,150Mortgage value =…

Answered: Global Corporation distributed property…

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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Ramon incorporated his sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation’s stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: FMV Adjusted Tax Basis Inventory $ 11,500 $ 4,800 Building 52,750 36,500 Land 122,000 60,000 Total $ 186,250 $ 101,300 The fair market value of the corporation’s stock received in the exchange equaled the fair market value of the assets transferred to the corporation by Ramon. (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) a. What amount of gain or loss does Ramon realize on the transfer of the property to his corporation? b. What amount of gain or loss does Ramon recognize on the transfer of the property to his corporation?
[The following information applies to the questions displayed below.] Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Inventory Building Land Adjusted Tax Basis $ 34,000 340,000 1,020,000 FMV $ 68,000 510,000 782,000 $ 1,360,000 $ 1,394,000 Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation's stock received in the exchange was $1,260,000. The transaction met the requirements to be tax-deferred under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Problem 08-40 Part d (Algo) d. What is the corporation's adjusted tax basis in each of the assets received in the exchange? Adjusted basis Land $
Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Adjusted Tax FMV Basis $ 56,000 420,000 644,000 $ 1,120,000 $ 28,000 280,000 840,000 Inventory Building Land $ 1,148,000 Total The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation's stock received in the exchange was $1,020,000. The transaction met the requirements to be tax-deferred under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Assume the corporation assumed a mortgage of $1,220,000 attached to the building and land. Assume the fair market value of the building is now $700,000 and the fair market value of the land is $1,484,000. The fair market value of the stock remains…
[The following information applies to the questions displayed below.]Zhang incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation’s stock. The property transferred to the corporation had the following fair market values and adjusted bases: FMV Adjusted Basis Inventory $ 68,000 $ 34,000 Building 510,000 340,000 Land 782,000 1,020,000 Total $ 1,360,000 $ 1,394,000 The corporation also assumed a mortgage of $100,000 attached to the building and land. The fair market value of the corporation’s stock received in the exchange was $1,260,000. The transaction met the requirements to be tax-deferred under §351. (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) a. What amount of gain or loss does Zhang realize on the transfer of the property to her corporation? C. What is Zhang’s tax basis in the…
3. Ramon incorporated his sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation’s stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: FMV Adjusted Tax Basis Inventory $ 10,000 $ 4,000 Building 50,000 30,000 Land 100,000 50,000 Total $ 160,000 $ 84,000 The fair market value of the corporation’s stock received in the exchange equaled the fair market value of the assets transferred to the corporation by Ramon. (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) What is Ramon’s basis in the stock he receives in his corporation?
Ramon incorporated his sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Inventory Building Land Total FMV $ 10,000 50,000 100,000 $ 160,000 Adjusted Tax Basis $ 4,000 30,000 50,000 $ 84,000 The fair market value of the corporation's stock received in the exchange equaled the fair market value of the assets transferred to the corporation by Ramon. Note: Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign. Required: a. What amount of gain loss does Ramon realize on the transfer of the property to his corporation? b. What amount of gain or loss does Ramon recognize on the transfer of the property to his corporation? c. What is Ramon's basis in the stock received in the new corporation? Required A Complete this question by entering your answers in…
Ramon incorporated his sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation's stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: Adjusted Tax Basis FMV $ 21,500 54,750 139,000 $ 215,250 $ 9,200 47,000 Inventory Building Land 69,000 $ 125,200 Total The fair market value of the corporation's stock received in the exchange equaled the fair market value of the assets transferred to the corporation by Ramon. (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) c. What is Ramon's basis in the stock he receives in his corporation? Tax basis
The Berry Corporation owns a building with a basis of $40,000 that is subject to a debt of $ 160,000. The FMV of the building is $100,000. Berry distributes the property in a nonliquidating distribution (along with the debt) to Delia, its sole shareholder. What is the amount of the distribution to Delia? a. $80,000. b. $50,000. c. zero. d. $30,000. e. none of the above.
5. Carla incorporated her sole proprietorship by transferring inventory, a building, and land to the corporation in return for 100 percent of the corporation’s stock. The property transferred to the corporation had the following fair market values and adjusted tax bases: FMV Adjusted Tax Basis Inventory $ 20,000 $ 10,000 Building 150,000 100,000 Land 250,000 300,000 Total $ 420,000 $ 410,000 The corporation also assumed a mortgage of $120,000 attached to the building and land. The fair market value of the corporation’s stock received in the exchange was $300,000. (Negative amounts should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) What amount of gain or loss does Carla recognizeon the transfer of the property to her corporation?
Indigo Corporation wants to transfer cash of $150,000 or property worth $150,000 to one of its shareholders, Linda, in a redemption transaction that will be treated as a qualifying stock redemption. If Indigo distributes property, the corporation will choose between two assets that are each worth $150,000 and are no longer needed in its business: Property A (basis of $75,000) and Property B (basis of $195,000). a. Compute Indigo’s recognized gain or loss if it distributes Property A in redemption of Linda’s shares. b. Compute Indigo’s recognized gain or loss if it distributes Property B in redemption of Linda’s shares. c. Compute Indigo’s recognized gain or loss if it sells Property B to an unrelated party and then distributes the sale proceeds in redemption of Linda’s shares.
An S-Corporation has ownership of a piece of land with an adjusted basis of $10,000 and a FMV of $100,000. It distributes this land to a shareholder, what basis would the shareholder have in this land? a. $0 b. It would depend on the shareholder's inside basis c. $90,000 d. $100,000 e. $10,000
Wasatch Corporation (WC) received a $200,000 dividend from Tager Corporation (TC). WC owns 15 percent of the TC stock. Compute WC's deductible dividends - received deduction (DRD) in each of the following situations: Required: a. WC's taxable income (loss) without the dividend income or the DRD is $10,000. b. WC's taxable income (loss) without the dividend income or the DRD is $(10,000). c. WC's taxable income (loss) without the dividend income or the DRD is $(99,000). d. WC's taxable income (loss) without the dividend income or the DRD is $(101,000). e. WC's taxable income (loss) without the dividend income or the DRD is $(500,000). f. What is WC's book - tax difference associated with its DRD in part (a)? Is the difference favorable or unfavorable? Is it permanent or temporary? Answer is not complete. Complete this question by entering your answers in the tabs below. WC's taxable income (loss) without the dividend income or the DRD is $10,000. Wasatch Corporation (WC) received a…

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