• Q : Problem related to adjusted basis in the stock....
    Accounting Basics :

    The building was encumbered by a mortgage of $100,000, which SUECO Inc. assumed. On the same day, and in exchange for the building she transferred to SUECO Inc., Sue received 100 percent of SUECO's

  • Q : Gain as a result of transaction....
    Accounting Basics :

    Tom received cash of $15,000 and an additional 55 shares of stock worth $55,000. How much gain was recognized by Tom as a result of this transaction?

  • Q : Shareholder as a result of the distribution....
    Accounting Basics :

    How much was the total dividend income received by the shareholder as a result of the distribution made by XYZ Corporation?

  • Q : Fair market value of the assets....
    Accounting Basics :

    Al transferred a building, cash, and IBM stock to ABC Corporation. The adjusted basis and the fair market value of the assets transferred to ABC Corporation, and the amount remaining on the mortgage

  • Q : Problem on dividends-received deduction....
    Accounting Basics :

    For the current taxable year, RST Inc.'s gross income from operations was $1,000,000 and its expenses from operations were $1,500,000. RST Inc. also received a $600,000 dividend from a 10 percent-ow

  • Q : Charitable contribution deduction for current taxable year....
    Accounting Basics :

    NOP Inc. had the following income and expenses during the current taxable year. Its income from operations was $250,000, its expenses from operations were $120,000, its dividends received (from a 30

  • Q : Net operating loss of amount....
    Accounting Basics :

    For the current taxable year, HIJ Inc. has taxable income or a net operating loss of what amount?

  • Q : Gain or loss realized and recognized by sales....
    Accounting Basics :

    Shortly after receiving Parcel A, Chris sold Parcel A to his friend from college for $73,000. How much gain or loss is realized and recognized by the respective parties as a result of each of the sa

  • Q : What is paula basis in the real estate....
    Accounting Basics :

    In exchange for her stock, Paula receives real estate with an $8,000 basis and a $15,000 fair market value that is subject to a $2,000 mortgage, and also receives cash of $5,000. What is Paula's bas

  • Q : Preparing a statement of cash-flows....
    Accounting Basics :

    Aero Inc. had the following balance sheet at December 31, 2011. Prepare a statement of cash flows for the year 2012 for Aero.

  • Q : Gain on the sale of apartment building....
    Accounting Basics :

    An individual purchased an apartment building for use in a business for $300,000 in 2005. Th e building was sold for $350,000 in October 2013. Depreciation taken was $84,000. If there is no other Se

  • Q : Current earnings and profits problem....
    Accounting Basics :

    Happy Inc. is a calendar year corporation. Happy Inc. had no accumulated earnings and profits, but had $100,000 of current earnings and profits in 2012.

  • Q : State or local government establishing capital projects fund....
    Accounting Basics :

    Why would a state or local government establish a capital projects fund? What type of project might be considered a capital project? Could operating functions ever be funded with capital projects fu

  • Q : Problem on married and file a joint return....
    Accounting Basics :

    Juan and Bettyna, ages 34 and 31, are married and file a joint return. In addition to having THREE dependent children (Talha, Maidelin, and Nicholas), Juan and Bettyna have adjusted gross income

  • Q : Gain for preferred and common stock....
    Accounting Basics :

    Warbler is merged into Wren Corporation. Kate receives Wren preferred stock worth $100,000 and common stock worth $50,000. Kate recognizes a gain of:

  • Q : Shareholder in the acquired corporation....
    Accounting Basics :

    Holly Wreath, a shareholder in the acquired corporation, turned in 100 shares of common stock with a basis of $4,200. In return she received voting convertible preferred stock worth $4,700 and a deb

  • Q : Problem related to distribution of land....
    Accounting Basics :

    At the time of the liquidating distribution, the land had a FMV of $160,000. What amount of loss can be recognized by Hill Corp. on the distribution of land?

  • Q : What is mark recognized gain....
    Accounting Basics :

    Mark receives property with a $10,000 basis and a $25,000 fair market value that is subject to a $12,000 mortgage, and also receives cash of $15,000. What is Mark's recognized gain?

  • Q : Problem related to performance-based bonus....
    Accounting Basics :

    Jones owns 100 percent of X Corporation. X Corporation's overall marginal tax rate is 35 percent. Jones' overall marginal tax rate is 30 percent. Jones needs $40,000 from the firm. The firm has deci

  • Q : Accumulated earnings and profits....
    Accounting Basics :

    Tugboats made a distribution of $25,000 cash to its stockholders on April 1, 2013. What is the amount of Tugboat's accumulated earnings and profits on January 1, 2014?

  • Q : Adjusted basis in the shares....
    Accounting Basics :

    Jennifer owns 1,000 shares of Ernie Company. Her adjusted basis in the shares is $100,000. Ernie Company has no earnings and profits. It made a cash distribution to its shareholders, of which Jennif

  • Q : Amount of cookies gain on the distribution....
    Accounting Basics :

    Cookies Corporation distributed land to its sole shareholder. On the date of distribution, the land had a fair market value of $85,000 and an adjusted basis to Cookies of $42,000. What is the amount

  • Q : Transactions reclassified as a constructive dividend....
    Accounting Basics :

    Harold owns 100 percent of Clawson Company. Clawson's E&P is $500,000. Harold needs to withdraw $100,000 from the company. Which of the following transactions might be reclassified as a construc

  • Q : Deferred tax liability-income taxes payable....
    Accounting Basics :

    Assume corporate tax rates are a constant 35%. Elco started operations at the beginning of this year. Its book income is $10 million and its taxable income is $13 million. The difference will give r

  • Q : Future taxable income....
    Accounting Basics :

    Future, Inc. reported the following results for the year: Future's taxable income for the year was:

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