Taxes and shares

Assignment Help Accounting Basics
Reference no: EM1364629

1) Longhorn Company reports current E&P of $100,000 in 20X3 and accumulated E&P at the beginning of the year of negative $200,000. Longhorn distributed $300,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in Longhorn is $100,000. How is the distribution treated by the shareholder in 20X3?

2) El Toro Corporation declared a common stock dividend to all shareholders of record on June 30, 20X3. Shareholders will receive 1 share of El Toro stock for each 2 shares of stock they already own. Raoul owns 300 shares of El Toro stock with a tax basis of $60 per share. The fair market value of the El Toro stock was $100 per share on June 30, 20X3. What are the tax consequences of the stock dividend to Raoul?

Reference no: EM1364629

Questions Cloud

Compute the learner index if the marginal cost of producing : Compute the Learner index if the marginal cost of producing Lipitor is $0.30 per pill. Does the Lerner index make sense in this situation.
Anatomical terminology of kicking a soccer ball : Describe the joint movements using anatomical terminology of kicking a soccer ball.
Classic airlines scenario : What is the situation and what challenges and opportunities exist? What is the problem and is it worth solving?
Find the velocity of the sailboat : A string with linear density 2g/m is stretched along the positive x-axis with tension 20 N. One end of the string, at x = 0, is tied to a hook that oscillates up and down at a frequency of 100 Hz with a maximum displacement of 1.0 mm. At t = 0s, t..
Taxes and shares : Longhorn Company reports current E&P of $100,000 in 20X3 and accumulated E&P at the beginning of the year of negative $200,000. Longhorn distributed $300,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in L..
Component of the circulatory system : Even though the lymphatic system is a component of the circulatory system, why is the term circulation not the most appropriate term to describe the flow of lymph?
Find company average collection period : Crasler Corporation net income last year was $100,000. The Corporation paid preferred dividends of $20,000 and its average common stockholders' equity was $580,000.
Create state transition diagram that explains patient states : Create a state transition diagram that describes typical patient states and how they change based on specific actions and events.
Reporting changes in accounting principle for depreciation : What are the accounting and reporting guidelines for a change in accounting principle related to depreciation methods?

Reviews

Write a Review

Accounting Basics Questions & Answers

  Plant assets-depreciation-disposal and depletion

Illustrate journal entries required and demonstrate the calculations necessary. How to calculate a change in the periodic rate is also shown. Plant asset disposal slides illustrate the following situations: retirement, loss on sale, and gain on sa..

  Investments at fair market value

Present a position either in favor or against the policy of stating investments at fair market value and that the changes be recognized as either revenues or as expenditures. Please give a few examples.

  Weighted-average method of accounting

Compute the equivalent units of production for the first department for April, assuming the company uses the weighted-average method of accounting for units and costs.

  Securities markets-economy

After the events of September 11, we were without our securities markets for few days. Though, it was a difficult condition, the markets opened in a few days and we managed.

  Audit-cobit methodology

How does an audit performed using CobiT methodology differ from an audit that doesn't?

  Direct materials price

The quantity purchased is used in computing the direct materials price variance because you are looking for the difference in the price of materials for the job

  Goodwill impairment in consolidating journal entries

Prepare the related consolidated journal entries if 30% of the goodwill is to be written off as impairment loss?

  Determine the amount of cost of goods sold using fifo, lifo

Stewart Company sold 180 units @ $320 each on October 31, 2012. Cash selling and administrative expenses were $15,000. The following information is also available: Determine the amount of cost of goods sold using:

  Information about risk aversion

Risk aversion implies which some securities will go unpurchased in market even if a large risk premium is paid to investors.

  Income under absorption costing

During the year just ended, Kerry Company's income under absorption costing was $3,000 lower than its income under variable costing.

  Accounting questions and transactions

At the end of the period it is necessary to close all temporary accounts. (1) Explain why this process is required and (2) provide an example of the closing of an expense account, Rent Expense in the form of a journal entry.

  Maximum deductible contribution

Sidney purchased land in 2004 for $35,000 that she held as a capital asset. This year, she contributed the land to the Boy Scouts of America for use as a site for a summer camp. The market value of the land at the date of contribution is $40,000. ..

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