What is the adjusted basis of mr ds stock

Assignment Help Accounting Basics

Reference no: EM131989286

Problem

Sara Inc. is a calendar-year S corporation with two shareholders who each own 50 shares of stock. Both shareholders purchased their stock for $5,000. Mr. D, one of the shareholders, made loans to the corporation of $7,000 and $6,000 on August 1, 2015, and June 15, 2016, respectively. Mr. D also guaranteed Sara's $20,000 bank loan of $20,000. Sara Inc. had $9,000 ordinary income on December 31, 2015. Both shareholders reported their share of the corporation's income on their individual returns for 2015. For 2016, Sara Inc. reported an ordinary loss of $5,000. No distributions were made in 2015 or 2016 by the corporation. What is the adjusted basis of Mr. D's stock on December 31, 2016? If an item does not contribute to basis, please explain.

Reference no: EM131989286

Questions Cloud

Make an original five whys root cause analysis : Make an original five whys root cause analysis. You must use 5 why to arrive at your root cause.

What should the internet company do : What should the Internet company do? Use ethical theories and ethical decision-making models to back up your decision.

Determine a production to maximize profit : Please formulate this problem as a LP to determine a production to maximize profit. o MUST define the decision variables first

How would affect the insurance companys liability : Based on the Sample Non-Owned Aircraft policy, will the insurance company pay, (and if so, how much) for each of the losses

What is the adjusted basis of mr ds stock : What is the adjusted basis of Mr. D's stock on December 31, 2016? If an item does not contribute to basis, please explain.

What are likely to be the two largest reconciling items : In essay fomrate please explain in your own words GASB Statement No. 34. What are likely to be the two largest reconciling items for most major cities? Why?

What impact does the globalization of sonys business have : What strategies do global companies employ to try to manage the risks associated with exchange rate fluctuations? How effective are these strategies?

What is the total cost savings that would result : Taylor manufactures 12,000 units of a part used in its production. What should Taylor's decision be, and what is the total cost savings that would result?

Traditional and modern approach to risk assessment : Describe the different between a traditional and modern approach to Risk Assessment. Which is the best to use? What are the advantage of using one over

User Account

All Pages