2 14. Pursuant to a complete liquidation, Richards Corporation distributes the following to a shareholder: Inventory,...
Fantastic news! We've Found the answer you've been seeking!
Question:
![2 14. Pursuant to a complete liquidation, Richards Corporation distributes the following to a shareholder:](https://dsd5zvtm8ll6.cloudfront.net/si.experts.images/questions/2023/09/65157b44c521a_62865157b44be169.jpg)
Transcribed Image Text:
2 14. Pursuant to a complete liquidation, Richards Corporation distributes the following to a shareholder: Inventory, basis $10,000, FMV $20,000; and land held as an investment, basis $5,000, FMV $40,000. The land is subject to a $30,000 liability. What are the amounts and character of income to be recognized by Richards Corporation? $10,000 ordinary income; $35,000 capital gain • $10,000 ordinary income; $65,000 capital gain • $0 ordinary income; $0 capital gain • $10,000 ordinary income; $5,000 capital gain . 2 14. Pursuant to a complete liquidation, Richards Corporation distributes the following to a shareholder: Inventory, basis $10,000, FMV $20,000; and land held as an investment, basis $5,000, FMV $40,000. The land is subject to a $30,000 liability. What are the amounts and character of income to be recognized by Richards Corporation? $10,000 ordinary income; $35,000 capital gain • $10,000 ordinary income; $65,000 capital gain • $0 ordinary income; $0 capital gain • $10,000 ordinary income; $5,000 capital gain .
Expert Answer:
Answer rating: 100% (QA)
In a complete liquidation of a corporation the shareholders generally recognize income or gain ... View the full answer
Related Book For
Federal Taxation 2021 Corporations, Partnerships, Estates & Trusts
ISBN: 9780135919460
34th Edition
Authors: Timothy J. Rupert, Kenneth E. Anderson, David S. Hulse
Posted Date:
Students also viewed these accounting questions
-
For each simplex tableau in Exercises 3 6, do the following:a. Determine which variable should be brought into the solution.b. Compute the next tableau.c. Identify the basic feasible solution...
-
This matrix represents a triangle: a. Graph the triangle. b. Find the result of this matrix multiplication: c. Graph the image represented by the matrix in 5b. d. Describe the transformation. 2 3 2 1...
-
a= b= Consider the function f(z) = 5z + az + bz 2 where z = C, and a, b R. If z = + is a solution to f(z) = 0, determine the values of a and b. QUESTION 2 Motorbike A has mass 407 kg and is...
-
Aggie, inc. purchased a truck at a cost of $12,000. the truck has an estimate salvage value of $2,000 and an estimated life of 5 years, or 100,000 hours of operation. The truck was purchased on...
-
Discuss how retailers can reduce shrinkage from shoplifting and employee theft.
-
Elaborate on the Production Locations of Pepsico Canada. Cite references.
-
Moving up. A sociologist studying social mobility in Denmark finds that the probability that the son of a lower-class father remains in the lower class is 0.46. What is the probability that the son...
-
Crafty Paint prepares and packages paint products. Crafty Paint has two departments: (1) Blending and (2) Packaging. Direct materials are added at the beginning of the blending process (dyes) and at...
-
Use the following data to compute total manufacturing costs for the month: Sales commissions $ 12,000 Direct labor 40,800 Indirect materials 16,400 Factory utilities 10,200 Indirect labor 14,700...
-
A direct extrusion operation produces the cross section shown in Figure P19.32(c) from an aluminum billet whose diameter = 150 mm and length = 500 mm. The flow curve parameters for the aluminum are K...
-
Which of the following is an example of normative economics? Group of answer choices The US unemployment rate was 6.7% in December 2020 Transgender bathrooms should have been legalized many years...
-
Exhibit 12: Average Credit Quality Ratios [1] Based on this information you can compare O&Rs financial ratios to the average debt rating ratios above to assess what O&Rs credit rating would be if it...
-
Which of the following statements about QuickBooks Bill Pay are correct? Select all that apply. You can configure QuickBooks Bill Pay to pay bills automatically when they're added to QuickBooks...
-
Ash purchases 500 shares of XYZ for $10/share. Ten months later, when the shares are trading at $15/share, they donate them to Caring Trust, a qualified charity. Three months after the donation is...
-
Bob gets a X = 60 on his psychology exam and a X = 56 on his Biology exam. Psych exam scores had a =50 and =10 while Bio exam scores had a =48 and =4. Both professors grade on a curve. 1 - For which...
-
1. Lucky Company's direct labor information for the month of February is as follows: Actual direct labor hours worked (AQ) 61,500 Standard direct labor hours allowed (SQ) 63,000 Total payroll for...
-
Under the payroll system of an organization we find several components such as HRM Department, Employees, Bank, Government Agencies, Insurance and other companies and various other departments. Take...
-
A report from the college dean indicates that for the previous semester, the grade distribution for the Department of Psychology included 135 As, 158 Bs, 140 Cs, 94 Ds, and 53 Fs. Determine what kind...
-
In a merger in which it subsequently liquidates, Thomas Corporation transfers to Andrews Corporation all its assets and $100,000 of its liabilities in exchange for Andrews voting common stock, having...
-
Bioteknic Corporation announced that it had entered into a merger agreement with Zalco Corporation, a research-based pharmaceutical company and a leader in drug delivery technologies. In a nontaxable...
-
John, who is unmarried, died on March 3, 2020. His gross estate of $16.5 million includes First Corporation stock (400 of the 1,000 outstanding shares) worth $10 million or $25,000 per share...
-
Discuss the qualitative characteristics of accounting information. AppendixLO1
-
Identify and compute ratios for analyzing a company's liquidity and solvency using a statement of cash flows. AppendixLO1
-
Explain the meaning of generally accepted accounting principles and describe the basic objective of financial reporting. AppendixLO1
![Mobile App Logo](https://dsd5zvtm8ll6.cloudfront.net/includes/images/mobile/finalLogo.png)
Study smarter with the SolutionInn App