Reference no: EM133151241

Questions -

Q1. XYZ Company distributed a filing cabinet to Susie Shareholder at a time when it had $50 of E&P. The filing cabinet was worth $5, had a cost to XYZ of $10, and XYZ claimed $3 of depreciation expense on the filing cabinet. The filing cabinet was encumbered by a $2 mortgage, which Susie assumed. How much dividend income must Susie recognize?

Q2. XYZ Company distributed a table Susie Shareholder at a time when it had $50 of E&P. The filing cabinet was worth $5, had a cost to XYZ of $9, and XYZ claimed $3 of depreciation expense on the filing cabinet. The filing cabinet was encumbered by a $2 mortgage, which Susie assumed. What is XYZ's E&P after the distribution?

Q3. XYZ Company distributed a filing cabinet to Susie Shareholder at a time when it had $50 of E&P. The filing cabinet was worth $5, had a cost to XYZ of $10, and XYZ claimed $3 of depreciation expense on the filing cabinet. The filing cabinet was encumbered by a $2 mortgage, which Susie assumed. What is Susie's adjusted basis in the filing cabinet?

Q4. FLO Company distributed a Thingding to Sally at a time when it had $1 of E&P. The Thingding was worth $21, had an adjusted basis of $17. How much dividend income must Sally recognize from the distribution?

Q5. X Corporation is a calendar year corporation that began the current year with E&P of $10. During the current year, X Corporation generated $600 of current E&P from operations. On June 30 of the current year, the company distributed an umbrella from its finished goods inventory to its sole shareholder, Samuel. The umbrellas adjusted basis to X Corporation was $50 The fair market value of the umbrellas at the time of the distribution was $30. What is the amount of X's E&P at year end?