Gain recognition as a result of distribution, Accounting Basics

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Gain recognition as a result of distribution

Big Corporation distributed land to its sole shareholder, Little Corporation, in a liquidating distribution. At the time of the distribution, the land had a fair market value of $240,000 and Big Corporation's adjusted basis in the land was $200,000. The land was encumbered by a $230,000 mortgage. How much gain did Big Corporation recognize as a result of the distribution?

a. 0.

b. $10,000.

c. $30,000.

d. $40,000.

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Accounting Basics: Gain recognition as a result of distribution

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Accounting Basics: Gain recognition as a result of distribution

Reference No:- TGS038705

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Recent Questions Asked Accounting Basics

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Request for Solution File

Ask an Expert for Answer!!

Accounting Basics: Gain recognition as a result of distribution

Reference No:- TGS038705

Recent Questions Asked Accounting Basics

Q : Zero coupon bonds and par bonds

Q : Fair market value of the assets transferred

Q : Dollar weighted rate of return

Q : Explain profitable pricing method

Q : Gain recognition as a result of distribution

Q : Required monthly mortgage payment

Q : Taxable income for the current taxable year problem

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