Jon, Ellyn and Rori each own 100 shares of JER Corporation. JER adopts a plan of complete liquidation. JER distributes $100,000 of cash to Jon; a capital asset with a fair market value of $100,000 and a tax basis $120,000 to Ellyn; inventory with a fair market value of $100,000 and tax basis of $70,000 to Rori. 

What gain and/or loss does JER recognize on distributions ?

Answer rating: 100% (QA)

JER recognizes a gain of 30000 120000 90000 on ... View the full answer