ration is owned equally by two individual shareholders. During the current year, Random reports the following results: Income Rentals: $200,000 Dividend (from a 25% owned domestic corporation): 30,000 Taxable interest: 15,000 Short-term capital gains: 3,000 Long-term capital gains: 17,000 Expenses related to rental income Interest: $30,000 Depreciation: 32,000 Property taxes: 11,000 Other Sec. 162 expenses: 50,000 General and administrative expenses: 10,000 Dividend paid on June 30: 15,000 What changes can management make to reduce the corporation’s PHC exposure in future years?
ration is owned equally by two individual shareholders. During the current year, Random reports the following results: Income Rentals: $200,000 Dividend (from a 25% owned domestic corporation): 30,000 Taxable interest: 15,000 Short-term capital gains: 3,000 Long-term capital gains: 17,000 Expenses related to rental income Interest: $30,000 Depreciation: 32,000 Property taxes: 11,000 Other Sec. 162 expenses: 50,000 General and administrative expenses: 10,000 Dividend paid on June 30: 15,000 What changes can management make to reduce the corporation’s PHC exposure in future years?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Stock in Random Corporation is owned equally by two individual shareholders. During the current year, Random reports the following results:
Income
Rentals: $200,000
Dividend (from a 25% owned domestic corporation): 30,000
Taxable interest: 15,000
Short-term capital gains: 3,000
Long-term capital gains: 17,000
Expenses related to rental income
Interest: $30,000
Depreciation: 32,000
Property taxes: 11,000
Other Sec. 162 expenses: 50,000
General and administrative expenses: 10,000
Dividend paid on June 30: 15,000
What changes can management make to reduce the corporation’s PHC exposure in future years?
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