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Problem $8-63($LO $8-5)($Algo$)$

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Tiffany and Carlos decided to liquidate their jointly owned corporation, Royal Oak Furniture $($ROF$).$ After liquidating its

remaining inventory and paying off its remaining liabilities, ROF had the following tax accounting balance sheet:

Under the terms of the agreement, Tiffany will receive the $$399,000$ cash in exchange for her $50$ percent interest in ROF.

Tiffany's tax basis in her ROF stock is $$65,750.$ Carlos will receive the building and land in exchange for his $50$ percent

interest in ROF. His tax basis in the ROF stock is $$108,000.$ Assume for purposes of this problem that the cash available to

distribute to the shareholders has been reduced by any tax paid by the corporation on gain recognized as a result of the

liquidation.

Note: Negative amounts should be indicated by a minus sign.

Problem $8-63$ Part g $($Algo$)$

Assume Tiffany owns $40$ percent of the ROF stock and Carlos owns $60$ percent. Tiffany will receive $$319,200$ in the liquidation and

Carlos will receive the land and building plus $$79,800.$

g$.$ What amount of gain or loss does Carlos recognize in the complete liquidation?