Sharon Bohnette owns 900 shares of Northern Chime Company. There are four seats on the board of directors up for election and Ms. Bohnette is one of the nominees. Under the traditional method of voting, how many votes may she cast for herself? Round your answer to the nearest whole number. votes How many votes may she cast for herself under the cumulative method of voting? Round your answer to the nearest whole number. votes
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- A, an individual, is an architect and general contractor. B is a wealthy individual. Newco's Certificate of Incorporation states that it is authorized to issue 200 shares, no par value of common stock. B transfers S500,000 of cash to Newco in exchange for 50 shares of Newco's stock. A signs a contract with Newco in which A will perform services designing a housing project and then acting as general contractor on the construction of that housing project. In exchange, A will receive 50 shares of Newco's stock. 1b) Suppose instead that A and Newco do not enter into a written contract. A transfers $500 in cash for 50 shares of Newco's stock while B transfers $500,000 for 50 shares of Newco's stock. A then performs the architectural and contracting services for no further charge. Would this change your answer?On July 1, 2021, Tony and Suzie organize their new company as a corporation, Great Adventures Inc. The articles of incorporation state that the corporation will sell 37,000 shares of common stock for $1 each. Each share of stock represents a unit of ownership. Tony and Suzie will act as co-presidents of the company. The following transactions occur from July 1 through December 31. Jul. 1 Sell $18,500 of common stock to Suzie. Jul. 1 Sell $18,500 of common stock to Tony. Jul. 1 Purchase a one-year insurance policy for $4,920 ($410 per month) to cover injuries to participants during outdoor clinics. Jul. 2 Pay legal fees of $1,900 associated with incorporation. Jul. 4 Purchase office supplies of $1,700 on account. Jul. 7 Pay for advertising of $280 to a local newspaper for an upcoming mountain biking clinic to be held on July 15. Attendees will be charged $50 on the day of the clinic. Jul. 8 Purchase 10 mountain bikes, paying $19,500 cash.…Suppose you are a CPA hired to represent a client who is currently under examination by the IRS. The client is the president and 95% shareholder of a building supply sales and warehousing business. He also owns 50% of the stock of a construction company. The client's son owns the remaining 50% of the construction company's stock. The client has received a notice of proposed adjustments (NPA) on three significant issues related to the building supply business for the years under examination. The issues identified in the NPA are unreasonable compensation, stock redemptions, and a rental loss. Additional facts regarding the issues are reflected below: Stock redemptions: During the audit period, the construction company redeemed 50% of the outstanding stock owned by the client and 50% of the stock owned by the client's son, leaving each with the same ownership percentage of 50%. The IRS treated the redemption as a distribution under IRC Section 301. Create a tax plan. Use Section 301 of…
- 65. XYZ is a stock corporation that wishes to elect 12 directors. Stockholder C, owns 10,000 shares out of 50,000 outstanding shares of XYZ corporation. Now, Stockholder C intends to know whether his shares of stocks are enough to secure the two slots of his desired directors to run said corporation. Is the shares of stocks owned by Stockholder C sufficient? A. Yes. Since Stockholder C own 10,000 shares out of the 50,000 outstanding shares of XYZ Corporation. Therefore, he can cast 5,000 shares each to his two desired directors to form part of XYZ's Board of Directors. B.No. Since Stockholder C owns 10,000 shares out of the 50,000 outstanding shares of XYZ Corporation, his share is insufficient to secure two slots of his desired directors. Hence, with the shares of stock he owns, he may only secure one slot in the Board of Directors to run XYZ Corporation.Kelvin is considering buying shares in a company. Kelvin asks you to explain to him what is meant by the terms ͚member͛ and shareholder͕͛ and ƚhe different ways in which a person may become a member. He also asks you to explain who may be eligible to become a member, and how many members a company is permitted ƚo haǀe͘ Finally, Kelvin asks ͞"How does a person cease to be a member of a company?͟" Required: Advise Kelvin.Dried Fruit Corp. has had a valid S Corp election in effect at all times since its incorporation. The Dried Fruit Corp. stock is owned one-third by Raisin and two-thirds by Prune. All shareholders are US resident citizen individuals. At the beginning of the current year, Raisin's basis in his shares was $12,000 and Prune's basis in her shares was $4,000. During the current year, Dried Fruit Corp. earned $72,000 of net income from operations. Raisin's share was $24,000; Prune's share was $48,000. On July 1st, Dried Fruit Corp. distributed $32,000 to Raisin and $64,000 to Prune. How much gain does Raisin recognize as a result of this transaction? O $12,000 O $4.000 Ⓒ $8,000 O $0
- What will be the Compensation for officers in the 1120, 2020 form? Please show the calculation as well. EC is owned by four related shareholders from the same family for the entire year: Raphael Giordano (father) and his three children Silvia, Andrea, and Marco. None of EC’s shareholders are non-U.S. persons. There are currently 10,000 shares of EC common stock issued and outstanding (EC has never issued preferred stock). The shareholders are also employees of EC and its only corporate officers. The relevant shareholder and officer information for the current year is provided below. Officer compensation is included in Employee Salaries on the income statement. Given in Income Statement for the period ending December 31, 2020 Salaries & Wages: $743,500. Their personal information is provided below. Raphael Giordano, Shares owned 5,500, 100% of time devoted to the business, compensation of $150,000 Silvia Giordano Costa, Shares owned 1,500, 100% of time devoted to the business,…Mitchell, Nelson, Olsen, and Parker, experts in manufacturing baubles, each owned fifteen out of one hundred authorized shares of Baubles, Inc., a corporation of State X, which does not permit cumulative voting. On July 7, 2007, the corporation sold forty shares to Quentin, an investor, for $1.5 million, which it used to purchase a fac- tory building for $1.5 million. On July 8, 2007, Mitchell, Nelson, Olsen, and Parker contracted as follows: All parties will act jointly in exercising voting rights as shareholders. In the event of a failure to agree, the question shall be submitted to George Yost, whose decision shall be binding upon all parties. Until a meeting of shareholders on April 17, 2014, when a dispute arose, all parties to the contract had voted consistently and regularly for Nelson, Olsen, and Parker as directors. At that meeting, Yost considered the dispute and decided and directed that Mitchell, Nelson, Olsen, and Parker vote their shares for the latter three as directors.…Larry Nelson holds 1,000 shares of General Electric's (GE) common stock. The annual stockholder meeting is being held soon, but as a minor shareholder, Larry doesn't plan to attend. Larry did not sell his shares but gave his voting rights to the management group running General Electric (GE). Larry must have signed a that gives the management group control over his shares. Larry also holds 2,000 shares of common stock in a company that only has 20,000 shares outstanding. The company's stock currently is valued at $43.00 per share. The company needs to raise new capital to invest in production. The company is looking to issue 5,000 new shares at a price of $34.40 per share. Larry worries about the value of his investment. Larry's current investment in the company is If the company issues new shares and Larry makes no additional purchase, Larry's investment will be worth . Larry could be protected if the firm's corporate charter includes a This scenario is an example of provision. If…
- Kenny Merinoff and his daughter, Mia, own all outstanding stock of flamingo Corporation. Both Mia and Kenny are officers in the corporation and together with Kenny’s Uncle, Ira, comprise the entire board of directors. Flamingo uses the cash method of accounting and has a calendar year-end. In late 2013, the board of directors adopted the following legally enforceable resolution (agreed to in writing by each of the officers): Salary payments made to an officer of the corporation that shall be disallowed in whole or in part as a deductible expense for Federal Income tax purposes shall be reimbursed by such officer to the corporation to the full extent of the disallowance. It shall be the duty of the board of directors to enforce payment of each such amount. In 2019, Flamingo paid Kenny $800,000 in compensation. Mia received $650,000. On an audit in late 2020, the IRS found compensation of both officers to be excessive. It disallowed deductions for $400,000 of the payment to Kenny and…Mary Phelps owns 2,000 of the 100,000 shares of Mega Corporation. By purchasing a minimum of the additional 50,000 shares authorized by the corporation, Mary is exercising her_ shares ofKimball, a partner in a one-office firm, inherits 15 shares of Spotless Housekeeping Services stock. The stock has a market value of $25 per share; there is a ready market for them; and there are 300,000 shares outstanding. Spotless is an audit client of the firm, and Kimball does no work or consulting for Spotless engagements. Which of the following is CORRECT regarding Kimball receiving this stock and maintaining the firm's independence with Spotless? As long as Kimball does not work on the engagements for Spotless, nothing need be done. If he works on the engagements for Spotless, then the shares must be promptly sold to preserve the firm's independence. Since the shares are worth only $375 and they were inherited, nothing need be done. If Kimball transfers the shares to a blind trust where he is the beneficiary, independence with Spotless will not be impaired. The shares must be sold within 30 days of their receipt.
