Jon owns 100 % of Jon, Inc (J). Jis liquidated and Jon receives land with a FMV of $500,000 and a tax basis of $300,000 and a building with a fair market value of $1,000,000 and a tax basis of $200,000. The building is subject to a mortgage of $100,000. Jon's basis in Jl stock $200,000. Jl has $3,000,000 of eamings and profits. As a result of the liquidation, Jon must recognize income of OA $1,400,000 dividend Income OB. $1,300,000 capital gain OC 50 income OD. $1,200,000 capital gain

Jon owns 100 % of Jon, Inc (J). Jis liquidated and Jon receives land with a FMV of $500,000 and a tax basis of $300,000 and a building with a fair market value of $1,000,000 and a tax basis of $200,000. The building is subject to a mortgage of $100,000. Jon's basis in Jl stock $200,000. Jl has $3,000,000 of eamings and profits. As a result of the liquidation, Jon must recognize income of OA $1,400,000 dividend Income OB. $1,300,000 capital gain OC 50 income OD. $1,200,000 capital gain

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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