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Problem 12-24 (LO. 2, 4) Rafael transfers the following assets to Crane Corporation in exchange for...
Rafael transfers the following assets to Crane Corporation in exchange for all of its stock. Assume...
Rafael transfers the following assets to Crane Corporation in exchange for all of its stock. Assume that neither Rafael nor Crane plans to make any special tax elections at the time of incorporation. Assets Rafael's Adjusted Basis Fair Market Value Inventory $60,000 $100,000 Equipment 150,000 105,000 Shelving 80,000 65,000 If an amount is zero, enter "O". Do not round any division in your computations. a. What is Rafael's recognized gain or loss? Rafael's realized of this amount, $ is $...
Problem 12-16 (LO. 2, 4) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following...
Problem 12-16 (LO. 2, 4) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following consideration: Consideration Transferred Basis to Transferor Fair Market Value Number of Shares Issued From Seth- Inventory $30,000 $96,000 30* From Pete- Equipment ($30,000 of depreciation taken by Pete in prior years) 45,000 99,000 From Cara- Proprietary process 15,000 90,000 From Jen- Cash 30,000 30,000 *Seth receives $6,000 in cash in addition to the 30 shares. **Pete receives $9,000 in cash in addition to the...
Brian incorporates his sole proprietorship as Fancy Corporation and transfers its assets to Fancy in exchange...
Brian incorporates his sole proprietorship as Fancy Corporation and transfers its assets to Fancy in exchange for all 100 shares of Fancy stock and five $12,000 interest-bearing notes. The stock has a(n) $120,000 FMV. The notes mature consecutively on the first five anniversaries of the incorporation date. The assets transferred are as follows: E: (Click the icon to view the asset information.) Read the requirements. Requirement a. What are the amounts and character of Brian's recognized gains or losses? Complete...
Exercise 20-14 (LO. 1) Osprey Corporation stock is owned by Pedro and Pittro, who are unrelated....
Exercise 20-14 (LO. 1) Osprey Corporation stock is owned by Pedro and Pittro, who are unrelated. Pedro and Pittro each own 50% and Pittro owns 50% of the stock in the corporation. Osprey has the following assets (none of which were acquired in a § 351 or contribution to capital transaction) that are distributed in complete liquidation of the corporation Adjusted Fair Market Value Cash Land Equipment Basis $300,000 200,000 250,000 $300,000 440,000 140,000 Assume that Osprey Corporation distributes the...
Problem 4-30 (LO. 1) Dan Knight and Patricia Chen, who are good friends, form Crane Corporation....
Problem 4-30 (LO. 1) Dan Knight and Patricia Chen, who are good friends, form Crane Corporation. Dan transfers and worth $200,000, basis of 60.000 for 50% of the stock in Crane. Patricia transfers machinery (worth $150,000, adjusted basis of 570.000) and provide services worth $50,000 for 50% of the stock a. Will the transfers qualify under 3517 Yes because all of Patricia's stockscounted in determining control since the property she transferred has than a nominal value in comparison to the...
4. Bruce Banner and Natasha Romanoff form Sakaar Corporation with the following investments. Bruce transfers equipment...
4. Bruce Banner and Natasha Romanoff form Sakaar Corporation with the following investments. Bruce transfers equipment (basis of $60,000 and fair market value of $150,000), while Natasha transfers land (basis of $25,000 and fair market value of $120,000) and services rendered (worth $30,000) in organizing the corporation. Each is issued 25 shares in Sakaar Corporation. (12 points) What amount of gain or loss will Bruce realize and recognize on the transaction and what is his basis in the stock received?...
Problem 18-26 (LO. 1, 3) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following...
Problem 18-26 (LO. 1, 3) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following consideration: Consideration Transferred Number of Shares Issued Basis to Fair Market Transferor Value From Seth- Inventory $30,000 $96,000 305 From Pete- Equipment ($30,000 of depreciation taken by Pete in prior years) 45,000 99,000 303* From Cara- Proprietary process 15,000 90,000 From Jen- Cash 30,000 30,000 10 Seth receives $6,000 in cash in addition to the 30 shares ceives $9,000 in cash in addition to...
Problem 7-12 (Algorithmic) (LO. 1, 2, 3) Kevin purchases 1,000 shares of Bluebird Corporation stock on...
Problem 7-12 (Algorithmic) (LO. 1, 2, 3) Kevin purchases 1,000 shares of Bluebird Corporation stock on October 3, 2018, for $340,000. On December 12, 2018, Kevin purchases an additional 750 shares of Bluebird stock for $238,000. According to market quotations, Bluebird stock is selling for $340 per share on 12/31/18. Kevin sells 500 shares of Bluebird stock on March 1, 2019, for $190,400. a. The adjusted basis of Kevin's Bluebird stock on December 31, 2018, is $ 595,000 . Feedback...
FMV 2. (15 points) X Corp's balance sheet shows the following: BASIS $10.000 Cash Equipment -net...
FMV 2. (15 points) X Corp's balance sheet shows the following: BASIS $10.000 Cash Equipment -net Land 1 Land 2 $10,000 40,000 100,000 150.000 50,000 150.000 125.000 $335,000 $300,000 Total All of the stock is owned by A. Her basis is $90,000. Answer the following questions based on the above information. A. Calculate the gain or loss to X Corp. if X liquidates and distributes all assets to A. B. Calculate the gain or loss to A on the liquidation...
Taxation - Code 351 Problem: Transfer to corporation controlled by transferor Please help me figure out...
Taxation - Code 351 Problem: Transfer to corporation controlled by transferor Please help me figure out the tax effects to both the shareholder and corporation. (What's each shareholder's recognized gain or loss, basis in their shares and the company's basis in the assets). All assets and liabilities were given during the incorporation. Shareholder A gave $100,000 in cash for 20% ownership/shares. Shareholder B gave a book binding equipment FMV $110,000, basis 30,000 and received $10,000 in cash plus 20% ownership/shares....
Rafael transfers the following assets to Crane Corporation in exchange for all of its stock. Assume that neither Rafael nor Crane plans to make any special tax elections at the time of incorporation. Assets Rafael's Adjusted Basis Fair Market Value Inventory $60,000 $100,000 Equipment 150,000 105,000 Shelving 80,000 65,000 If an amount is zero, enter "O". Do not round any division in your computations. a. What is Rafael's recognized gain or loss? Rafael's realized of this amount, $ is $...
Problem 12-16 (LO. 2, 4) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following consideration: Consideration Transferred Basis to Transferor Fair Market Value Number of Shares Issued From Seth- Inventory $30,000 $96,000 30* From Pete- Equipment ($30,000 of depreciation taken by Pete in prior years) 45,000 99,000 From Cara- Proprietary process 15,000 90,000 From Jen- Cash 30,000 30,000 *Seth receives $6,000 in cash in addition to the 30 shares. **Pete receives $9,000 in cash in addition to the...
Brian incorporates his sole proprietorship as Fancy Corporation and transfers its assets to Fancy in exchange for all 100 shares of Fancy stock and five $12,000 interest-bearing notes. The stock has a(n) $120,000 FMV. The notes mature consecutively on the first five anniversaries of the incorporation date. The assets transferred are as follows: E: (Click the icon to view the asset information.) Read the requirements. Requirement a. What are the amounts and character of Brian's recognized gains or losses? Complete...
Exercise 20-14 (LO. 1) Osprey Corporation stock is owned by Pedro and Pittro, who are unrelated. Pedro and Pittro each own 50% and Pittro owns 50% of the stock in the corporation. Osprey has the following assets (none of which were acquired in a § 351 or contribution to capital transaction) that are distributed in complete liquidation of the corporation Adjusted Fair Market Value Cash Land Equipment Basis $300,000 200,000 250,000 $300,000 440,000 140,000 Assume that Osprey Corporation distributes the...
Problem 4-30 (LO. 1) Dan Knight and Patricia Chen, who are good friends, form Crane Corporation. Dan transfers and worth $200,000, basis of 60.000 for 50% of the stock in Crane. Patricia transfers machinery (worth $150,000, adjusted basis of 570.000) and provide services worth $50,000 for 50% of the stock a. Will the transfers qualify under 3517 Yes because all of Patricia's stockscounted in determining control since the property she transferred has than a nominal value in comparison to the...
Problem 18-26 (LO. 1, 3) Seth, Pete, Cara, and Jen form Kingfisher Corporation with the following consideration: Consideration Transferred Number of Shares Issued Basis to Fair Market Transferor Value From Seth- Inventory $30,000 $96,000 305 From Pete- Equipment ($30,000 of depreciation taken by Pete in prior years) 45,000 99,000 303* From Cara- Proprietary process 15,000 90,000 From Jen- Cash 30,000 30,000 10 Seth receives $6,000 in cash in addition to the 30 shares ceives $9,000 in cash in addition to...
FMV 2. (15 points) X Corp's balance sheet shows the following: BASIS $10.000 Cash Equipment -net Land 1 Land 2 $10,000 40,000 100,000 150.000 50,000 150.000 125.000 $335,000 $300,000 Total All of the stock is owned by A. Her basis is $90,000. Answer the following questions based on the above information. A. Calculate the gain or loss to X Corp. if X liquidates and distributes all assets to A. B. Calculate the gain or loss to A on the liquidation...
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