Mavis is the sole shareholder of Randiff, Inc., an S corporation with a December 31 year-end. The...
Mavis is the sole shareholder of Randiff, Inc., an S corporation with a December 31 year-end. The basis of her stock at January 1, 20X1, is $20,000. She loaned the corporation $10,000 on January 1, 20X1. The corporation had a taxable loss of $24,000 in 20X1 and taxable income of $15,000 in 20X2. What is the stock basis at December 31, 20X2?
| A. | $6,000 | ||
| B. | $11,000 | ||
| C. | $12,000 | ||
| D. | $24,000 |
Homework Answers
Answer: B. $ 11,000.
Mavis' stock basis at December 31, 20X2 = $ 20,000 - $ 24,000 + $ 15,000 = $ 11,000.
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