John's Market, Inc. is a local grocery store with 10 stores all around RI. It has individual and corporate shareholders. It finds it has excess cash and purchases a dairy business. Ten years later, John's Market, Inc. decides to distribute the assets of the dairy business to its shareholders on a pro-rata basis. Does the distribution of the assets of the dairy business satisfy the termination of business test? If so, how? How do the shareholders treat the distribution of the assets of the dairy business to them?

Answer rating: 100% (QA)

ANSWER Assets such as properties and separate businesses can be transferred to shareholders either b... View the full answer