XCorp and YCorp are each 100% owned by Xerxes. Xerxes has decided to amalgamate them without triggering tax by using Section 87 of the Income Tax Act. XCorp had 200 common shares with a PUC and ACB of $500, and a FMV of $5,000. YCorp has 100 common shares with a PUC and ACB of $700, and a FMV of $6,000. What is the PUC and ACB of the amalgamated company’s shares?
XCorp and YCorp are each 100% owned by Xerxes. Xerxes has decided to amalgamate them without triggering tax by using Section 87 of the Income Tax Act. XCorp had 200 common shares with a PUC and ACB of $500, and a FMV of $5,000. YCorp has 100 common shares with a PUC and ACB of $700, and a FMV of $6,000. What is the PUC and ACB of the amalgamated company’s shares?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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XCorp and YCorp are each 100% owned by Xerxes. Xerxes has decided to amalgamate them without triggering tax by using Section 87 of the Income Tax Act. XCorp had 200 common shares with a PUC and ACB of $500, and a FMV of $5,000. YCorp has 100 common shares with a PUC and ACB of $700, and a FMV of $6,000.
What is the PUC and ACB of the amalgamated company’s shares?
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