User Account

All Pages

What is the effect on Pink Corporation

Assignment Help Accounting Basics
Reference no: EM132662497

Problem - Decision Making, Last year Pink Corporation acquired land and securities in a § 351 tax-free exchange. On the date of the transfer, the land had a basis of $720,000 and a fair market value of $1,000,000 and the securities had a basis of $110,000 and a fair market value of $250,000. Pink Corporation has two shareholders, Maria and Paul, who are unrelated. Maria owns 85% of the stock in the corporation, and Paul owns 15%. Pink adopts a plan of liquidation in the current year. On this date, the value of the land has decreased to $500,000. What is the effect of each of the following on Pink Corporation? Which option should be selected?

a. Distribute all of the land to Maria.

b. Distribute all of the land to Paul.

c. Distribute 85% of the land to Maria and 15% to Paul.

d. Distribute 50% of the land to Maria and 50% to Paul.

e. Sell the land and distribute the proceeds of $500,000 proportionately to Maria and to Paul.

Reference no: EM132662497

Questions Cloud

Evaluate microsofts product and marketing evolution : Evaluate Microsoft's product and marketing evolution over the years. What has the company done well, and where did it falter?
Difference between quantitative and qualitative question : -List and describe the components of a research report and provide a brief overview of each component?
Alternative models of organisational capabilities : Define organisational capabilities and discuss two alternative models of organisational capabilities.
What the entry in the unadjusted trial balance for home loan : What the entry in the Unadjusted Trial Balance for Home loan is? Interest on the ANZ Bank Mortgage Loan is charged at 7% per annum and is paid annually
What is the effect on Pink Corporation : On this date, the value of the land has decreased to $500,000. What is the effect of each of the following on Pink Corporation? Which option should be selected
Has education truly ever been the great equalizer : Education is assumed to be the "great equalizer" in our society. After completing the reading for this module you quickly discover that it is not.
Implementation of soda taxes : What are the arguments for and against the implementation of soda taxes? What ethical values are in conflict?
Prepare the consolidation elimination journal entry for year : The following account balances existed at 30 June 2020. Prepare the consolidation elimination journal entry for the year ending 30 June 2020.
Briefly explain how eliza is related to the turing test : The ELIZA chatbot, then briefly explain how ELIZA is related to the Turing Test. The Chinese Room argument, then briefly explain how it is related to.

Reviews

Write a Review

Accounting Basics Questions & Answers

  Budgeted sales data

Parlee Company's sales are 30% in cash and 70% on credit. Sixty % of the credit sales are collected in the month of sale, 25% in the month following sale, and 12% in the second month following sale. The remainder is uncollectible. The following ar..

  Total budgeted manufacturing overhead

The total budgeted manufacturing overhead for the year was $2,000,000, of which $1,600,000 was variable and $400,000 was fixed.

  Explain what an unearned revenue account is

Explain what accrued revenues are and let us know why these adjustments are necessary. Please provide an example of an adjusting entry for accrued revenues.

  Pepare a schedule indicating cash collections from sales

The company expects to sell 10% of its merchandise for cash of sales on account, Pepare a schedule indicating cash collections from sales for March and April

  What is a contingent liability

Describe the three ranges of loss contingencies outlined in SFAS No. 5, including a brief summary of the accounting and disclosure requirements

  Chris smith coffee and pastry cart

Chris Smith coffee and pastry cart and a procurement card. Suggest some controls that should be in place. Identify some resources that need to be purchased for this business.

  Create a diagram comparing accrual and cash accounting

Create a diagram comparing accrual and cash accounting. Also include a 350- to 700-word summary of the differentiation and uses of the two.

  Prepare an income statement for fido treats for the year

fido treats its own brand of pet chew bones. at the end of december 2014 the accounting records showed the

  Find what the current tax liability is

What the current tax liability is? Accounting profit before income tax (after all expenses have been included), Entertainment expenses (not tax deductible)

  Istructions write a memo to phil perriman to clear up his

as a cost accountant for san francisco cannery you have been approached by phil perriman canning room supervisor about

  Quantitative methods-the case for business modeling

Multiple models are often used in supporting business decision making. Why might this be the case and what factors may dictate the need for multiple models?

  Crdinal llc incurred 20000 of startup expenses 3000 of

cardinal llc incurred 20000 of startup expenses 3000 of organizational costs and paid 10000 in transfer taxes to change

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd