Question
Jayhawk Company reports current E&P of $502,500 and accumulated E&P of negative $350,000. Jayhawk distributed $592,500 to its sole shareholder, Christine Rock, on the last
Jayhawk Company reports current E&P of $502,500 and accumulated E&P of negative $350,000. Jayhawk distributed $592,500 to its sole shareholder, Christine Rock, on the last day of the year. Christines tax basis in her Jayhawk stock is $65,250.(Leave no answer blank. Enter zero if applicable.) (Negative amounts should be indicated by a minus sign.) a. How much of the $592,500 distribution is treated as a dividend to Christine? b. What is Christines tax basis in her Jayhawk stock after the distribution? c. What is Jayhawks balance in accumulated E&P on the first day of next year?
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