What are the tax consequences in given years

Assignment Help Finance Basics

Reference no: EM131928410

Question: Investor owns 1,000,000 shares of stock of Corp. XYZ with a zero basis and a FMV of 100,000,000 that the investor has held for 20 years. The investor sells 1,000,000 shares of XYZ short for $100,000,000 in February, 2015. On January 21, 2016 the investor purchases 1,000,000 shares with a normal settlement for 120,000,000 and instructs the broker to deliver those shares to close the short sale. XYZ paid 4 dividends during 2015. The ex-dividend dates were March 1, June 1, September 1, and December 1. The total amounts of the dividends were $5,000,000. The investor did not borrow any money with respect to the transaction and because interest rates were so low did not receive any rebate on the short sale proceeds. What are the tax consequences in 2015 and 2016?

Reference no: EM131928410

Questions Cloud

Determine the expected cash collections in may : Operating expenses to be paid with cash in May will be $110,300. The cash balance as of May 1 was $126,900. Determine the Expected cash collections in May

Annual percentage rate : Pay off the amount borrowed to purchase the car with a 5 year loan, and the annual percentage rate (APR) will be 0%.

Evaluate the internal rate of return for each investment : Direct labor is $10 per hour. There are 250 operating days in the year. Both the truck and the bagging machine are estimated to have five-year lives.

Calculate the portfolio expected return and beta : Can someone please advise how would I present and calculate the portfolio expected return and beta, assuming equal weights for the following two companies:

What are the tax consequences in given years : Investor owns 1,000,000 shares of stock of Corp. XYZ with a zero basis and a FMV of 100,000,000 that the investor has held for 20 years.

By how much will working capital at december : Kroger, Inc. is a calendar-year corporation. Ignoring income taxes, by how much will working capital at December 31, 2012 be overstated or understated

Calculate standard deviation assuming a portfolio : Can someone please advise how would I present and calculate standard deviation assuming a portfolio of equal weights for the following 2 companies:

Minimal amount company should bid for each park : The company pays tax at 35%. Find the minimal amount company should bid for each park?

What are the rates with continuous compounding : The 6-month, 12-month. 18-month,and 24-month risk-free zero rates are 4%, 4.5%, 4.75%, and 5% with semiannual compounding.

User Account

All Pages