Question

Lansing Company is owned equally by Jennifer, her husband Dan, and Dewitt Corporation, which is owned 50 percent by Jennifer and her sister Jane. Each of the three shareholders holds 260 shares in the company Under the $318 stock attribution rules, how many shares of Lansing stock is Dewitt Corporation deemed to own?

Brun Company reports Current ERP of $320,000 in 20x3 and accumulated EAP at the beginning of the year of $150,000 Bruin distributed $520,000 to its sole shareholder on January 1, 20X3. How much of the distribution is treated as a dividend in 20X3? 

Answer 1

Ans 1

In the given first question Dewitt Corporation should deemed to owned 780 which is the shares of dewitt corporation , jennifer & her husband as per 318 stock attribution rules

Ans 2

For20X3 dividend is $320000 which is current E&P.