User Account

All Pages

What are the tax consequences to the shareholder

Assignment Help Cost Accounting
Reference no: EM13539819

Beacon Corporation had operated a chain of restaurants for 15 years and owned a small trucking company for 10 years. It decided to sell all the assets of the trucking company (Section 1231 assets) for $1,500,000. The assets had a basis of $900,000 and the corporation is in the 34 percent marginal tax bracket. The company invested half of the after-tax sale proceeds to update some of its restaurants, and distributed the remaining half to its shareholders in exchange for 10,000 shares of their stock in Beacon.

a. If the shareholders' average bases in their shares are $45 per share, what are the tax consequences to the shareholder and the corporation from this distribution?

b. How would your answers change if Beacon received only $600,000 for the assets of the trucking business?

Reference no: EM13539819

Questions Cloud

Evaluate its angular acceleration in radians per second : A potter's wheel moves uniformly from rest to an angular speed of 0.23 rev/s in 31.0 s. Find its angular acceleration in radians per second
What is the velocity of the particle at the origin : At one instant, the center of mass of a system of two particles is located on the x-axis at x = 2.0 and has a velocity of (5.0 ). What is the velocity of the particle at the origin
Evaluate the dielectric constant of the inserted material : An air-filled parallel plate capacitor with a plate spacing of 1.20 cm has a capacitance of 5.00 ?F. evaluate the dielectric constant of the inserted material
Obtain how much additional charge will flow from the battery : A parallel-plate air capacitor of area A=17.0cm2 and plate separation d=3.40mm is charged by a battery to a voltage 56.0 V. how much additional charge will flow from the battery onto the positive plate
What are the tax consequences to the shareholder : What are the tax consequences to the shareholder and the corporation from this distribution and how would your answers change if Beacon received only $600,000 for the assets of the trucking business?
Calculate what is the speed of the particle : A charged particle moves in a region of uniform magnetic field along a helical path, What is the speed of the particle as it moves along this path
What are the consequences to the corporation : The basis of the land in the corporation's hands is $68,000. What are the consequences to the corporation and the shareholders as a result of this distribution?
Find the angle through which the cd has rotated : At the start of a CD it is spinning at a rate of 569 rpm (revolutions per minute). Just as the CD finishes playing it is spinning at a rate of 247 rpm. Find the angle through which the CD has rotated during its playing time
What is whitlaws income tax : What is Whitlaws income tax and complete a Schedule M-1 or a facsimile for the corporation.

Reviews

Write a Review

Cost Accounting Questions & Answers

  Qthe management of gilmartin corporation a manufacturing

qthe management of gilmartin corporation a manufacturing company has provided the following data for

  On 112012 company abc gets 20000 shares of company xyz at

on 112012 company abc gets 20000 shares of company xyz at cash price of 10 per share. company xyz has 300000 shares

  Compute the predetermined overhead rate

Comparative balance sheet of Anders Company, illustrate horizontal and vertical analysis - financial statements and additional information, compute the following ratios for Coulter Company for 2009. Show all computations.

  What is the cumulative cash flow at the end of Quarter

What is the cumulative cash flow at the end of Quarter

  What is the amount of the net decrease in cash

What is the amount of the net decrease in cash during the month - what is the amount of the net increase in stockholders' equity during the month

  Capital intensive method labor intensive method

Explain the circumstance under which the Sanchez Company should employ each of the two manufacturing methods.

  Graeter corporation acquired all of stock of lesser

graeter corporation acquired all of stock of lesser corporation in 2009 and enities have filed a state and federal

  Operating profit for the year

Do you think that Company Z cranked up production output to 2,500,000 units mainly to boost its operating profit for the year?

  Calculate the originally reported earnings per share

Calculate the originally reported earnings per share for the year ended September 30, 2010.

  Floyd a cash basis taxpayer sold land in which he had a

floyd a cash basis taxpayer sold land in which he had a basis of 10000 for 100000. he received 25000 on 1st january of

  Questionon january 1 2002 platte company purchased 80

questionon january 1 2002 platte company purchased 80 percent of the common stock of river company.during 2002 river

  Create entries for monthly expenses

We are not creating entries for monthly expenses such as rent and preparing the financial statements and documents floating around that may or may not be needed for efficient and effective processing of the business information and paper that is no..

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