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What is beta taxable gain on the sale

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Reference no: EM132957212

Acme Corporation, a C Corporation acquires the stock of Beta Corporation, a C corporation, for $50 in cash from Beta's shareholders. The shareholders' basis in their shares is $15. Beta's basis in its assets is $25 and the fair market value of the assets is $100 (Ignore any depreciation recapture on these assets).

Problem 1. What is Beta's taxable gain on the sale?

a. $25 Capital Gain

b. $75 Capital Gain

c. No Gain

d. $50 Capital Loss

Problem 2. What is the aggregate taxable gain to Beta's shareholders?

a. $85 Capital Gain

b. $35 Capital Gain

c. $10 Capital Gain

d. No Gain

Reference no: EM132957212

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