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Doug invests heavily in stocks. He purchased 300 shares of Tubular, Inc. for $30 per share 2 years ago. In the current year, Tubular made
Doug invests heavily in stocks. He purchased 300 shares of Tubular, Inc. for $30 per share 2 years ago. In the current year, Tubular made a nontaxable distribution of 10 stock rights for each 100 shares of its outstanding stock. Each stock right had a FMV of $20. The Tubular stock was worth $60 per share on the distribution date. What is Doug's lowest possible basis in the stock rights?
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Corporate Finance A Focused Approach
Authors: Michael C. Ehrhardt, Eugene F. Brigham
4th Edition
1439078084, 978-1439078082
