Q Corporation, an S corporation, is solely owned by V. Vs stock basis at the beginning of
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Question:
Q Corporation, an S corporation, is solely owned by V. V’s stock basis at the beginning of the year is $8,000. Q has the following beginning-of-year account balances:
Accumulated Adjustments Account (AAA) $10,000
Accumulated Earnings and Profits (AE&P) 15,000
Other Adjustments Account (OAA) 6,000
For the year, Q Corporation reported a net ordinary income of $12,000 and a tax-exempt income of $7,000. It also made a cash distribution to V at year-end of $30,000.
Required
Calculate the corporation's AAA and AE&P at year-end. SHOW WORK FOR PARTIAL CREDIT.
Related Book For
Financial Accounting
ISBN: 978-0078025549
3rd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
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