Question
Jack Slater is the sole shareholder of an S corporation. During 2018, Jack received a distribution of $22,000. His basis in the stock at December
Jack Slater is the sole shareholder of an S corporation. During 2018, Jack received a distribution of $22,000. His basis in the stock at December 31, 2017 was $2,000. The S corporation earned ordinary income of $12,000 in 2018. The corporation had no accumulated E & P. What should be the amount of return of capital for Jack?
a. $2,000
b. $12,000
c. $14,000
d. $8,000
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Managerial Accounting Tools For Business Decision Making
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
2nd Canadian Edition
0471413658, 978-0471413653
