Steven Garcia has invested $555000 in a privately held family corporation. The corporation does not do well and must declare bankruptcy. What amount does Garcia stand to lose? O Up to his total investment of $555000. O The $555000 plus any personal assets the creditors demand. O $370000. O Zero.

Steven Garcia has invested $555000 in a privately held family corporation. The corporation does not do well and must declare bankruptcy. What amount does Garcia stand to lose? O Up to his total investment of $555000. O The $555000 plus any personal assets the creditors demand. O $370000. O Zero.

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter13: Comparative Forms Of Doing Business

Section: Chapter Questions

Problem 13DQ

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Maria Lowell invests $50,000 in a privately held corporation. Things do not go as planned and the corporation declares bankruptcy. Maria has not signed any personal guarantees for the corporation's liabilities. How much does Maria stand to lose? $25,000 The $50,000 plus any personal assets the creditors demand. Up to her total investment of $50,000. Zero
5.
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1. Tim loaned a friend $4,000 to buy a used car. In the current year, Tim's friend declares bankruptcy and the debt is considered totally worthless. What amount may Tim deduct on his individual income tax return for the current year as a result of the worthless debt, assuming he has no other capital gains or losses for the year? a.$3,000 short-term capital loss b.$4,000 short-term capital loss c.$3,000 ordinary loss d.$4,000 ordinary loss e.$2,000 short-term capital loss 2. An asset's adjusted basis is computed as: a.Original basis − capital improvements + accumulated depreciation. b.Original basis + capital improvements − accumulated depreciation. c.Original basis + capital improvements + gain or loss realized. d.Original basis + capital improvements + accumulated depreciation. e.None of these choices are correct. 3. Sol purchased land as an investment on January 12, 2018 for $85,000. On January 31, 2021 Sol sold the land for $90,000 cash. What is the nature of the gain or loss?…
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Here is another problem: Miranda is in the process of forming a corporation. She wants to capitalize it with $5,000,000. Are there any advantages to loaning some of the money to the corporation? Are there any limitations to this tactic?
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