What are parents basis for the assets received

Reference no: EM131955984

Problem

Parent Corporation purchased 75 percent of Subsidiary Corporation in 2000; Subsidiary's current balance sheet shows the following figures:

Basis Value
Demand Deposit $20,000 $20,000
IBM Stock $30,000 $50,000
Parking Lot $5,000 $30,000
Building 0 $100,000
Mortgage ($15,000) ($15,000)

Subsidiary has a net operating loss carryover in 2006 of $7,000 and earnings and profits of $22,000. The subsidiary redeemed in 2003 the 25% shareholder Roy Rogers. The Subsidiary distributed the IBM stock for his 25% interest. In 2006, Subsidary adpots a plan of liquidation.

What are Parent's basis for the assets received?

Reference no: EM131955984

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