Question
Anon-depreciable capital asset with a fair market value(FMV) of$200,000 and an adjusted cost base(ACB) of$120,000 is transferred to a corporation pursuant to ITA85(1), with the
Anon-depreciable capital asset with a fair market value(FMV) of$200,000 and an adjusted cost base(ACB) of$120,000 is transferred to a corporation pursuant to ITA85(1), with the elected value being$120,000. The transferor receives cash consideration of$100,000 and shares with a legal stated capital of$100,000. ITA85(2.1) indicates that the reduction in paid up capital(PUC) of the shares would be
A.
$120,000.
B.
$20,000.
C.
$100,000.
D.
$80,000.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Financial Accounting The Impact on Decision Makers
Authors: Gary A. Porter, Curtis L. Norton
9th edition
130565417X, 1305654174, 9781285972572 , 978-1285182964
