Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent ofthe corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted taxbases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negativeamount should be indicated by a minus sign.)Adjusted TaxFMVBasis$ 114,375266,875$ 30,500122,000BuildingLand$ 381,250$ 152,500TotalTo equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock.Assume Hermione's adjusted tax basis in the land was $305,000.g. What adjusted tax basis does Wizard Corporation take in the land and building received from Hermione?LandBuildingAdjusted tax basis

The initial cost or another basis of assets, as decreased by depreciation deductions and raised by…

Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Adjusted Tax Basis FMV $ 114,375 266,875 $ 381,250 $ 30,500 122,000 $ 152,500 Building Land Total To equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock. Assume Hermione's adjusted tax basis in the land was $305,000. g. What adjusted tax basis does Wizard Corporation take in the land and building received from Hermione? Land Building Adjusted tax basis

Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Adjusted Tax Basis FMV $ 114,375 266,875 $ 381,250 $ 30,500 122,000 $ 152,500 Building Land Total To equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock. Assume Hermione's adjusted tax basis in the land was $305,000. g. What adjusted tax basis does Wizard Corporation take in the land and building received from Hermione? Land Building Adjusted tax basis

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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Ramona and Hermione formed Wiley Corporation on January 2. Ramona contributed cash of $235,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: FMV Adjusted Tax Basis Building $ 88, 125 $ 23,500 Land 205, 625 94, 000 Total $ 293,750 $ 117,500 To equalize the exchange, Wiley Corporation paid Hermione $58, 750 in addition to her stock. d. What is Hermione's tax basis in the stock received in return for the contribution of property to the corporation? e. What adjusted tax basis does Wiley Corporation take in the land and building received from Hermione? f. Assume Hermione's adjusted tax basis in the land was $235,000. What amount of gain or loss does Hermione realize on the formation of the corporation? What amount, if any, does she recognize? G. Assume Hermione's adjusted tax basis in the land was $235,000. What adjusted tax basis…
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Ramona and Hermione formed Wiley Corporation on January 2. Ramona contributed cash of $300,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: FMV Building $112,500 Land 262,500 Total $375,000 Adjusted Tax Basis $30,000 120,000 $150,000 To equalize the exchange, Wiley Corporation paid Hermione $75,000 in addition to her stock. i. Assume Hermione's adjusted tax basis in the land was $375,000. What adjusted tax basis does Wiley Corporation take in the land and building received from Hermione seperately?
Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Adjusted Tax Basis FMV $ 114,375 266,875 $ 30,500 122,000 Building Land $ 381,250 $ 152,500 Total To equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock. a. What amount of gain or loss does Ron realize on the formation of the corporation? What amount, if any, does he recognize? Gain or loss realized Gain or loss recognized
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Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Adjusted Tax FMV Basis $ 114,375 266,875 $ 381,250 $ 30,500 122,000 $ 152,500 Building Land Total To equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock. Assume Hermione's adjusted tax basis in the land was $381,250. i. What adjusted tax basis does Wizard Corporation take in the land and building received from Hermione? O Answer is complete but not entirely correct. Land Building Adjusted tax basis 175,375 X $ 53,375
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Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $305,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted tax bases in return for 50 percent of the corporation's stock: (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Adjusted Tax FMV Basis Building $ 114,375 266,875 $ 381,250 $30,500 Land 122,000 $ 152,500 Total To equalize the exchange, Wizard Corporation paid Hermione $76,250 in addition to her stock. Assume Hermione's adjusted tax basis in the land was $305,000. g. What adjusted tax basis does Wizard Corporation take in the land and building received from Hermione? Land Building Adjusted tax basis $ 53,375