How much of the entity loss can Rosa deduct

Assignment Help Accounting Basics
Reference no: EM132649444

Problem - Rosa contributes $50,000 to a business entity in exchange for a 10% ownership interest. Rosa materially participates in the entity. The entity incurs a loss of $900,000 for the current year and holds liabilities at the end of the year of $700,000. Of this amount, $150,000 is recourse debt and $550,000 is nonrecourse debt.

Required -

a. Assume that the business entity is a partnership. How much of the entity loss can Rosa deduct on her income tax return? What is her basis for the partnership interest at the end of the current tax year?

b. Assume that the business entity is a C corporation. How much can Rosa deduct on her income tax return? What is her basis for the stock at the end of the current tax year?

Reference no: EM132649444

Questions Cloud

How to strengthen positive influences of television : As part of your research, consider practical recommendations to include in your paper for how to strengthen positive influences of television/media viewing.
Conflict affect russian politics and democracy : How will the conflict affect Russian politics and democracy, and a workable nationalities policy?
Identify concrete strategies for achieving your goal : Identify concrete strategies for achieving your goal. Identify potential obstacles you may face in attempting to achieve your goal and strategies.
Formation of the presidential doctrine : Presidential doctrine and summarize the regional or global events during the Cold War leading up to the formation of the presidential doctrine
How much of the entity loss can Rosa deduct : How much of the entity loss can Rosa deduct on her income tax return? What is her basis for the partnership interest at the end of the current tax year
Explain the non-material brain and the soul : Explain how bio psychologists study the workings of the brain (which you cannot see). Explain the non-material brain, the soul. The response must be typed.
What are Jo and Velma bases for their partnership interests : Velma contributing land and a building (adjusted basis of $125,000; What are Jo and Velma bases for their partnership interests
Identify problems with perception of social workers : Identify Problems with Perception of Social Workers. Discuss how the challenge of public perception of Social Work impacts our practice.
Social security and medicare benefits : Describe key policies that the U.S. government could implement in order to ensure positive changes for Social Security and Medicare benefits

Reviews

Write a Review

Accounting Basics Questions & Answers

  Calculate break-even point both in total units

Calculate break-even point both in total units and total sales dollars

  Calculate the contract price and gross profit ratio

X, an individual, not a dealer, owns land and a building. Calculate the Contract Price and Gross Profit Ratio and the amount of gain

  Potential customers enter the system each hour

A service facility consists of one server who can serve an average of two customers per hour (service times are exponential). An average of three customers per hour arrive at the facility (interarrival times are assumed to be exponential).

  Question regarding four basic financial statements

What are the four basic financial statements? What do the different financial statements tell you about a company? Which financial statement is the most useful? Why?

  How models used for valuing stock options can be adapted

Evaluate how models used for valuing stock options can be adapted to other underlying assets such as stock indexes.

  Prepare the journal entry to record the purchase

Garcia Corporation purchased a truck by issuing an $249,600, 4-year, Prepare the journal entry to record the purchase of this truck

  Calculate the contribution margin for each product

Calculate breakeven volume in total dollars if the sales mix is 2 units of X for every 3 units of Y.

  Journal entries to establish the petty cash

The petty cash fund of Western Glass Company contained the following items on November 30, 2009: Prepare the journal entries to establish the petty cash account and to replenish the fund at the end of November.

  Prepare sheridans adjusting entry on wednesday

Prepare Sheridan's adjusting entry on Wednesday, December 31, and the journal entry to record the $5,350 cash payment on Friday, January 2

  How many units were started and completed during the period

The Finishing Department uses first-in, first-out (FIFO) process costing. How many units were started and completed during the period

  Determine the amount of the adjusting entry

Determine the adjusted balances of Accounts Receivable, Allowance for Doubtful Accounts, and Bad Debt Expense. Determine the net realizable value of accounts

  Prepare budgets-forecast estimates and documenting budgets

FNSACC503 - Manage Budgets and Forecasts - What are some potential areas for improvement for Zoomer's Auto Shop and What two options could you use for more effective management of deviations

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd