How much gain will a recognize


The following is a balance sheet of X corporation just prior to its complete liquidation


Cash 15,000
Accts Receiv 10,000
Equipment 5,000
Land 45,000
Total 75,000

Accts payable 18,000
Mortgage payable 30,000
Capital stock 20,000
Earned surplus 7,000
Total 75,000


The fair market value of the land is 100,000 all other property is worth book value. A owns all the X stock, which he acquired for 20,000 several years ago. Disregarding the effect of any corporate level income tax otherwise resulting per Section 336, how much gain will a recognize upon complete liquidation of X

 

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Accounting Basics: How much gain will a recognize
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