Exercise 20-25 (Algorithmic) (LO. 3) Townsend, the sole shareholder of Pruett Corporation, has a $437,600 basis in his stock. He exchanges all of his Pruett stock for $547,000 of Rogers Corporation voting common stock plus land with a fair market value of $109,400 and basis of $27,350. Pruett distributed the land to Townsend. This exchange meets all Code requirements. If an amount is zero or there is no gain or loss, enter "0". a. What is Townsend's recognized gain/loss from the reorganization? Townsend recognizes a gain ✓ of $ 1,094,000 X. b. What is the gain/loss recognized by Pruett Corporation and Rogers Corporation on the reorganization? Rogers Corporation recognizes a gain ✔ of $ of $ 0 V. 0 X and Pruett Corporation recognizes no gain or loss c. What is Townsend's basis in the Rogers stock and the land received? The basis in the Rogers stock is $ 0 X and the basis in the land is $ 0 X.

Exercise 20-25 (Algorithmic) (LO. 3) Townsend, the sole shareholder of Pruett Corporation, has a $437,600 basis in his stock. He exchanges all of his Pruett stock for $547,000 of Rogers Corporation voting common stock plus land with a fair market value of $109,400 and basis of $27,350. Pruett distributed the land to Townsend. This exchange meets all Code requirements. If an amount is zero or there is no gain or loss, enter "0". a. What is Townsend's recognized gain/loss from the reorganization? Townsend recognizes a gain ✓ of $ 1,094,000 X. b. What is the gain/loss recognized by Pruett Corporation and Rogers Corporation on the reorganization? Rogers Corporation recognizes a gain ✔ of $ of $ 0 V. 0 X and Pruett Corporation recognizes no gain or loss c. What is Townsend's basis in the Rogers stock and the land received? The basis in the Rogers stock is $ 0 X and the basis in the land is $ 0 X.

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter4: Corporations: Organization And Capital Structure

Section: Chapter Questions

Problem 19CE

See similar textbooks

Similar questions

Exercise 18-20 (Algorithmic) (LO. 1, 2) Grady exchanges property with a basis of $20,667 and fair market value of $24,800 for 60% of the stock of Eadie Corporation. Pedro acquired the other 40% of the stock five years ago. Calculate Grady's current income, gain, or loss and the basis he takes in his shares of Eadie stock as a result of this transaction. Because this transaction and $ the control of the corporation requirement, Grady has basis in his shares of stock. of
Exercise 18-23 (Algorithmic) (LO. 1, 2) Yvonne and Simon form Ion Corporation. Yvonne transfers equipment with a basis of $377,600 and fair market value of $566,400 to Ion Corporation. Simon invests $453,120 of cash. They each receive 100 shares in Ion Corporation worth $453,120, but Yvonne also receives $113,280 in cash from Ion. Calculate Ion Corporation's basis in the equipment and determine Yvonne and Simon's basis in the Ion stock. Ion Corporation has a basis of $ basis of $ for his stock. in the equipment. Yvonne has a basis of $ for her stock and Simon has a
Ma1. Question Content AreaMars Corporation merges into Jupiter Corporation by exchanging all of its assets for 300,000 shares of Jupiter stock valued at $2 per share and $100,000 cash. Wanda, the sole shareholder of Mars, surrenders her Mars stock (basis $900,000) and receives all of the Jupiter stock transferred to Mars plus the $100,000. How does Wanda treat this transaction on her Federal income tax return? a.Wanda recognizes a $100,000 gain. Her Jupiter stock basis is $900,000. b.Wanda recognizes a loss of $0. Her Juniper stock basis is $800,000. c.Wanda recognizes a $100,000 gain. Her Jupiter stock basis is $700,000. d.Wanda recognizes a loss of $100,000. Her Jupiter stock basis is $800,000.
8. A, an individual, owns all 100 shares of X Co. A's basis in these shares is S1 per share ($1000 total). 8a) A transfers 10 shares to Xin exchange for cash of 10. How will this transaction be treated for tax purposes? 8b) Suppose instead that there are 2 shareholders, A and B. Each owns 50 shares of X Co. A transfers all 50 shares to X in exchange for cash of 50. How will this transaction be treated? 8c) Same as (b) except that A and B are husband and wife. Would this change your answer?
8. A, an individual, owns all 100 shares of X Co. A's basis in these shares is $1 per share ($100 total). 8a) A transfers 10 shares to X in exchange for cash of 10. How will this transaction be treated for tax purposes? 8b) Suppose instead that there are 2 shareholders, A and B. Each owns 50 shares of X Co. A transfers all 50 shares to X in exchange for cash of 50. How will this transaction be treated? 8c) Same as (b) except that A andBare husband and wife. Would this change your answer?
551. CHAPTER 6â€”CORPORATIONS: REDEMPTIONS AND LIQUIDATIONS Question 66 Pursuant to a qualifying stock redemption, Redbird Corporation (E & P of $400,000) transfers land held for investment purposes to Bob, a 10% shareholder. On the date of the distribution, Redbird has a basis of $200,000 in the land and its fair market value is $150,000. Bob has a basis of $40,000 in the shares redeemed. With respect to the redemption: a. Bob will recognize a gain of $110,000. b. Bob will have $150,000 of dividend income. c. Bob will have a $200,000 basis in the land. d. Redbird Corporation will recognize a capital loss of $50,000. e. None of the above. 552. CHAPTER 6â€”CORPORATIONS: REDEMPTIONS AND LIQUIDATIONS Question 67 Canary Corporation has 1,000 shares of stock outstanding. It redeems in a qualifying stock redemption 350 shares for $400,000 at a time when it has paid-in capital of $100,000 and E & P of $1 million. What would be the charge to…
Exercise 12-2 (LO. 2, 3) Grady exchanges property with a basis of $12,000 and fair market value of $18,000 for 60% of the stock of Eadie Corporation. Pedro acquired the other 40% of the stock five years ago. Calculate Grady's current income, gain, or loss and the basis he takes in his shares of Eadie stock as a result of this transaction. Because this transaction and $ the control of the corporation requirement, Grady has [ basis in his shares of stock. of
9. Darrel exchanged his stocks in Queen Corporation for the stocks of Queendom Corporation pursuant to a plan of merger between Queen and Queendom. Darrel acquired his stocks for P100,000 when its fair value was P105,000. The shares of Queen and Queendom have fair values of P120,000, and P110,000, respectively on the date of exchange. istiqe 190 pd ei jedw What is the tax basis of the Queendom shares received and the gain to be recognized in the exchange? 000,0 000.1E a. P120,000; P20,000 d c. P105,000; P 0 b. P 110,000; P20,000 d. P100,000; P 0 sisab s ton asgas68 M2
9 Roberta transfers property with a tax basis of $495 and a fair market value of $546 to a corporation in exchange for stock with a fair marl corporation assumed a liability of $190 on the property transferred. What is the amount realized by Roberta in the exchange? 36:42 TRENEMEN SHEMAL THE TRUT Multiple Choice $273 $356 $495 $546
Exercise 4-21 (Algorithmic) (LO. 1, 2, 3) Jocelyn contributes land with a basis of $48,500 and fair market value of $72,750 and inventory with a basis of $21,400 and fair market value of $32,100 in exchange for 100% of Zion Corporation stock. The land is subject to a $12,125 mortgage. Determine Jocelyn's recognized gain or loss and the basis in the Zion stock received. If an amount is zero, enter "0". The exchange § 357(a). As a result, Jocelyn has income of $ tax-free under § 351 because the release of a liability and a basis $ in her stock. treated as boot under
Townsend, the sole shareholder of Pruett Corporation, has a $545,600 basis in his stock. He exchanges all of his Pruett stock for $682,000 of Rogers voting common stock plus land with a fair market value of $136,400 and basis of $34,100. Pruett distributed the land to Townsend. This exchange meets all Code requirements. If an amount is zero or there is no gain or loss, enter "0". a. What is Townsend's recognized gain/loss from the reorganization? Townsend recognizes a gain of $_____________ b. What is the gain/loss recognized by Pruett Corporation and Rogers Corporation on the reorganization?Rogers Corporation recognizes a gain of $___________ and Pruett Corporation recognizes no gain or loss of $0 c. What is Townsend's basis in the Rogers stock and the land received?The basis in the Rogers stock is $___________ and the basis in the land is __________
! Required information [The following information applies to the questions displayed below.] Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $200,000 in return for 50 percent of the corporation's stock. Hermione contributed a building and land with the following fair market values and adjusted bases in return for 50 percent of the corporation's stock: Building Land Total FMV $ 75,000 175,000 $250,000 To equalize the exchange, Wizard Corporation paid Hermione $50,000 in addition to her stock. Adjusted basis Assume Hermione's adjusted basis in the land was $250,000. i. What adjusted basis does Wizard Corporation take in the land and building received from Hermione? (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.) Tax- Adjusted Basis $ 20,000 80,000 $100,000 Land $ Building 20,000