Homework Answers
The second option is correct answer :
The distribution is treated as a dividend to the extent of current period E&P. The excess distribution is first a return of basis to the extent of the shareholder's tax basis and then capital gain hence
First 165,000 is dividend
Next 165,000 is return on basis &
Next balancing 165000 is capital gain.
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Longhorn Company reports current ESP of $165.000 in 20XC and a deficit of ($330,000) in accumulated...
Longhorn Company reports current E&P of $185,000 in 20X3 and a deficit of ($370,000) in accumulated...
Longhorn Company reports current E&P of $185,000 in 20X3 and a deficit of ($370,000) in accumulated E&P at the beginning of the year. Longhorn distributed $555,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in Longhorn is $185,000. How is the distribution treated by the shareholder in 20Χ3? Multiple Choice Ο $555,000 dividend. Ο $185,000 dividend, $185,000 tax-free return of basis, and $185,000 capital gain. Ο () $185,000 dividend and $370,000 tax-free return...
Longhorn Company reports current E&P of $130,000 in 20X3 and accumulated E&P at the beginning of...
Longhorn Company reports current E&P of $130,000 in 20X3 and accumulated E&P at the beginning of the year of negative $260,000. Longhorn distributed $390,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in Longhorn is $130,000. How is the distribution treated by the shareholder in 20X3? Multiple Choice $130,000 dividend. $130,000 dividend, $130,000 tax-free return of basis, and $130,000 capital gain. $130,000 dividend and $260,000 tax-free return of basis. $0 dividend, $130,000 tax-free...
Aztec Company reports current E&P of $200,000 in 20x3 and a deficit of ($100,000) in accumulated...
Aztec Company reports current E&P of $200,000 in 20x3 and a deficit of ($100,000) in accumulated E&P at the beginning of the year. Aztec distributed $300,000 to its sole shareholder on January 1, 20X3. How much of the distribution is treated as a dividend in 20X3? Multiple Choice $300,000 $200,000. $100,000. $0.
X Inc. has beginning accumulated E&P of $10,000 and current E&P deficit for the year of...
X Inc. has beginning accumulated E&P of $10,000 and current E&P deficit for the year of ($9,000). The corporation makes a cash distribution on the last day of the tax year of $7,000 to the sole shareholder. The shareholders stock basis before the distribution was $4,000. find the following: 1. amount of taxable dividend 2. non-taxable return of capital 3. recognized capital gain
This year, Sooner Company reports current E&P of negative $300,000. Its accumulated E&P at the beginning...
This year, Sooner Company reports current E&P of negative $300,000. Its accumulated E&P at the beginning of the year was $200,000. Sooner distributed $400,000 to its sole shareholder, Boomer Wells, on June 30 of this year. Boomer’s tax basis in his Sooner stock is $75,000. a. How much of the $400,000 distribution is treated as a dividend to Boomer? b. What is Boomer’s tax basis in his Sooner stock after the distribution? c. What is Sooner’s balance in accumulated E&P...
Jayhawk Company reports current E&P of $357,500 and accumulated E&P of negative $255,000. Jayhawk distributed $590,000...
Jayhawk Company reports current E&P of $357,500 and accumulated E&P of negative $255,000. Jayhawk distributed $590,000 to its sole shareholder, Christine Rock, on the last day of the year. Christine’s tax basis in her Jayhawk stock is $178,000. (Leave no answer blank. Enter zero if applicable. Negative amounts should be indicated by a minus sign.) a. How much of the $590,000 distribution is treated as a dividend to Christine? b. What is Christine’s tax basis in her Jayhawk stock after...
Longhorn Company reports current E&P of $185,000 in 20X3 and a deficit of ($370,000) in accumulated E&P at the beginning of the year. Longhorn distributed $555,000 to its sole shareholder on January 1, 20X3. The shareholder's tax basis in his stock in Longhorn is $185,000. How is the distribution treated by the shareholder in 20Χ3? Multiple Choice Ο $555,000 dividend. Ο $185,000 dividend, $185,000 tax-free return of basis, and $185,000 capital gain. Ο () $185,000 dividend and $370,000 tax-free return...
Aztec Company reports current E&P of $200,000 in 20x3 and a deficit of ($100,000) in accumulated E&P at the beginning of the year. Aztec distributed $300,000 to its sole shareholder on January 1, 20X3. How much of the distribution is treated as a dividend in 20X3? Multiple Choice $300,000 $200,000. $100,000. $0.
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