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Show computations 1. Two days before the ex-div...




Show computations 1. Two days before the ex-dividend date, A corporation buys 100 shares of B corporation stock(a less than 1% interest)for $200,000. A corporation receives $10,000 of dividends from B corporation. Two weeks after the ex-dividend date, A sells the B corporation stock for $190,000. Which of the following statement is correct? a. A corporation cannot recognize a capital loss b. A corporation cannot take a dividends-received deduction on the B dividend. c. A corporation will be allowed a 70% dividends-received deduction when reporting the B dividend. d. A corporation will receive no dividends-received deduction because the stock was purchased ex-dividend. 2.Tony owns 100% of M corporation's single class of stock. Tony transfers land and a building having a $30,000 and $100,000 adjusted basis, respectively, to M corporation in exchange for additional M corporation common stock worth $200,000 and IBM stock worth $20,000. The IBM stock had a $5,000 basis on M corporation's books. Bill transfers $50,000 in cash for 15% of the M corporation common stock. What amount of gain is recognized by Tony and M corporation on the exchange? Tony M corporation a. $0 $0 b. $0 $15,000 c. $20,000 $0 d. $20,000 $15,000 3. Bill and Ken own Tax, Inc.(an S corporation)equally. In 2004, the corporation reported a $130,000 ordinary loss. Tax Inc.'s liabilities at the end of 2004 included $100,000 of accounts payable, $150,000 of mortgages payable, and a $20,000 note owned to Bill. Each owner has a $40,000 adjusted basis for his stock on January 1, 2004. Compute the loss reportable by Bill. a. $65,000 b. $60,000 c. $40,000 d. none of the answers are correct 4. Corporations X,Y,and Z are component members of a controlled group of corporations on December 31 of the current year. For the current year, they allocate taxable income brackets under an apportionment plan as follows: Corporation X 1/4 of each tax bracket Corporation Y 1/2 of each tax bracket Corporation Z 1/4 of each tax bracket corporation Y has taxable income of $80,000 for the current year. What is corporation Y's income tax liability if the controlled group's total taxable income is $97,000? a. $12,000 b. $15,400 c. $18,680 d. $21,325 5. Bill transferred property worth $75,000 and services worth $25,000 to the X corporation. In exchange, he received stock in X valued at $100,000. Immediately after the exchange, Bill owned 80% of the only class of outstanding stock. Which of the following is true with respect to Bill's treatment of the transaction? a. short term capital gain of $100,000 b. short term capital gain of $25,000 c. ordinary income of $25,000 d. no income until the stock is sold,Hi Michael, Do you know how to solve these questions? I appreciate your help!,If anyone can solve these questions, I would like to postpone the due time to 11:00am today. Thank you very much!


Paper#7897 | Written in 18-Jul-2015

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