On february 1 of year 1 richard mike patrick and sean form

Assignment Help Accounting Basics

Reference no: EM13594166

On February 1 of year 1, Richard, Mike, Patrick, and Sean form Brothers Corp and transfer the following items: Property Transferred Transferor Asset Basis to Transferor FMV Number of Common Shares Issued Richard Land 27000 40000 600 Building 28000 80000 Mortgage on Land and Building 70000 70000 Mike Machines 25000 40000 400 Patrick Truck 15000 5000 50 Sean Legal Services 0 15000 150 Richard purchased the building and land several years ago, $40,000 for the building, and $22,000 for the land. Depreciation has been claimed using the straight line method. In addition to the machines, Mike received a note from Brothers corp. due in 3 years for $10,000 at the market interest rate. Mike originally purchased the machines 3 years ago for $50,000. In addition to the truck, Patrick received a cash payment of $10,000. Patrickâs truck is 2 years old with an original price of $25,000.

(a) Does the transaction meet the requirements of section 351?

(b) What are the amounts of the gains or losses recognized by Richard, Mike, Patrick, Sean, and Brothers?

(d) What is Brothersâ basis in its property and services? When does the holding period for each property begin? List each asset separately. Read the scenario and respond to the questions. Support your answers with calculations, as needed. Show your work.

Reference no: EM13594166

Questions Cloud

What is the orbital angular momentum for the lowest : what is the orbital angular momentum for the lowest electron orbit in the hydrogen atom?a according to bohr?b according

Differentiate between the spot rate and the forward : differentiate between the spot rate and the forward exchange rate and discuss whether or not these rates are critical

The electron and proton of a hydrogen atom are separated on : the electron and proton of a hydrogen atom are separated on the average by a distance of approximately 5.3 x 10-11 m.

Find a line item listed on either the income statement or : look up nikes annual report and answer the following questions in the 4.3 discussion adjusting entries forum1. find a

On february 1 of year 1 richard mike patrick and sean form : on february 1 of year 1 richard mike patrick and sean form brothers corp and transfer the following items property

You are given a 10-mh inductor and 2 capacitorsof 50 and : question you are given a 10-mh inductor and 2 capacitorsof 5.0 and 2.0-mf capacitance. list the resonant frequencies

Tim don and hans are partners with capital balances of : tim don and hans are partners with capital balances of 30142 23668 and 53768 respectively. they share income in the

During january kroger paid 9150 for supplies to be used in : the following information is taken from the accrual accounting records of kroger sales companya. during january kroger

The rock has credit sales of 425000 during 2013 and : the rock has credit sales of 425000 during 2013 and estimates at the end of 2013 that 1.5 of these credit sales will

User Account

All Pages