Solution-What adjusted basis does a take in as share of

What adjusted basis does a take in as share of asset

Assignment Help Accounting Basics

Reference no: EM133093105

Question - A and B, unrelated individuals, were the sole shareholders of L corporation. A was a 60% shareholder and B was a 40% shareholder. Pursuant to a plan of liquidation, L liquidated and distributed its two assets to A and B pro rata. (Asset#1 a capital asset acquired 2 years ago in a Section 351 transaction with a fair market value ("FMV") of $100,000 and an adjusted basis of $110,000 and Asset #2 an ordinary asset acquired two years ago in a taxable purchase with a FMV of $60,000 and adjusted basis of $70,000). L also distributed a liability of $10,000 (pro rata). L had no other tax attributes or transactions.

A's adjusted basis $100,000 and B's adjusted basis was $20,000 in their L shares respectively.

i. What income, gain or loss, if any, does L recognize as a result of the Liquidation?

ii. What income, gain of loss, if any, does B recognize as a result of the Liquidation?

iii. What adjusted basis does A take in A's share of Asset #1?

Reference no: EM133093105

Questions Cloud

Illustrate module with bpmn or activity diagram : As a group, think about one CRM tool (examples: Salesforce. Microsoft Dynamics, Zoho etc) that could be applied to the company you researched in Assignment Set

Determine which machine is preferable and why : Assuming that cost of capital is 11% per annum, provide an analysis based on net present value to determine which machine is preferable, and why

Demanders of healthcare policy : Interest groups, often called lobbyists, are demanders of healthcare policy. In Democratic societies, lobbyists serve a purpose in that through their collective

Russian government history of interfering : Given the Russian government's history of interfering with private business and targeting political dissidents, would you make as large of an investment in Russ

What adjusted basis does a take in as share of asset : Pursuant to a plan of liquidation, L liquidated and distributed its two assets to A and B pro rata. What adjusted basis does A take in As share of Asset

Employees religious requirements : What should employers do when appearance requirements conflict with employees' religious requirements?

How is health defined : 1. How is health defined? What aspects are incorporated into the World Health Organization definition?

Analyzing and mitigating risks in international trade : Pay attention to spelling and grammar. The plan must be written and not lead to confusion.

Identify trade routes compatible with intermodal shipments : Identify trade routes compatible with intermodal shipments within North America for crude oil and LNG?

User Account

All Pages

What adjusted basis does a take in as share of asset

Reference no: EM133093105

Reference no: EM133093105

Questions Cloud

Reviews

Write a Review

Accounting Basics Questions & Answers

How much control does fed have over this longer real rate

Coures:- fundamental accounting principles

Accounting problems

Theory of interest - term structure of interest rates

Write a report on internal controls

Prepare the bank reconciliation for company

Cost-benefit analysis

Theory of interest

Liquidity and profitability

What is the expected risk premium on the portfolio

Simple interest and compound interest

Capm and venture capital

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT