Reference no: EM131262275
Bonnie and Clyde are the only two shareholders in Getaway Corporation. Bonnie owns 60 shares with a basis of $7,300, and Clyde owns the remaining 40 shares with a basis of $16,000. At year-end, Getaway is considering different alternatives for redeeming some shares of stock. (Round your answers to the nearest whole number.)
a. Getaway redeems 18 of Bonnie’s shares for $6,000. Getaway has $28,000 of E&P at year-end and Bonnie is unrelated to Clyde.
Bonnie owns 60% before the redemption and _______% after the redemption.
Does this qualify as a sale or exchange? If so, how much is the gain?
b. Getaway redeems 33 of Bonnie’s shares for $12,000. Getaway has $28,000 of E&P at year-end and Bonnie is unrelated to Clyde.
Bonnie owns 60% before the redemption and _______% after the redemption.
Does this qualify as a sale or exchange? If so, how much is the gain?
c. Getaway redeems 6 of Clyde’s shares for $6,500. Getaway has $28,000 of E&P at year-end and Clyde is unrelated to Bonnie.
Bonnie owns 40% before the redemption and _______% after the redemption.
Does this qualify as a sale or exchange? If so, how much is the gain?
|
The straw men approach to business ethics
: Which of the following is not the straw men approach to business ethics. Which business straw men approach to business ethics is best summarized by the maxim when in Rome do as the Roman's do. Islamic countries are likely to be receptive to internati..
|
|
Compute the depreciation for each of the three years
: Renner Corporation purchased a delivery van for $26,300 in 2014. The van was expected to have a useful life of 160,000 miles and a salvage value of $2,300. Actual mileage was as follows: 2014 50,000 2015 45,000 2016 47,000 Required. Compute the depre..
|
|
Calculate amount of under-over-absorbed overhead for year
: Carmen has a bakery that specializes in dog foos in a variety of sizes and flavors. Carmen uses a flexible budget to forecast manufacturing overhead, which is then allocated to products based on over hours. Calculate the overhead application rate at ..
|
|
Routine maintenance of production equipment
: How would I write journal entries for the following? Sold land that had originally cost $117,000 for $102,600 in cash. Recorded a $612,000 payment for the cost of developing and registering a patent. Expensed $14,100 of cash expenditures incurred for..
|
|
Does this qualify as a sale or exchange
: Bonnie and Clyde are the only two shareholders in Getaway Corporation. Bonnie owns 60 shares with a basis of $7,300, and Clyde owns the remaining 40 shares with a basis of $16,000. At year-end, Getaway is considering different alternatives for redeem..
|
|
Disregarding any interest liabilities
: Alexi files her tax return 5 days after the due date. Along with the return, she remits a check for 6,700, which is the balance of the tax she owes. The failure to file is not is attributable to fraud. Assume 30 days in a month. If required, round yo..
|
|
Bonus equal to difference in corporations taxable income
: Nittany Company pays its sole shareholder, Tammy Lion, a salary of $105,600. At the end of each year, the company pays Tammy a "bonus" equal to the difference between the corporation’s taxable income for the year (before the bonus) and $67,500. How m..
|
|
Assuming the distribution is non-taxable
: Badger Corporation declared a stock dividend to all shareholders of record on March 25 of this year. Shareholders will receive one share of Badger stock for each 10 shares of stock they already own. What amount of taxable dividend income, if any, doe..
|
|
What is the income tax imposed on the corporate income
: Bulldog Corporation reported taxable income of $660,000 this year, before any deduction for any payment to its sole shareholder and employee, Georgia Brown. Bulldog chose to pay a bonus of $172,000 to Georgia at year-end. Bulldog Corporation is subje..
|