Lilac, a C Corporation, was formed at the beginning of 2017. Lilac's E&P history is as follows:

Calendar Year	Current E&P	Distributions
2017 2018 2019	$6,000 5,000 1,000	$4,000 1,000 2,000

Lilac Corporation's accumulated E&P on January 1, 2020 will be

Question 13 options:

	$5,000.
	$7,000.
	$12,000.
	$0.

Question 14 (1 point)

Arthur transferred the following assets to Potato Corporation, an existing C corporation.

	Adjusted Basis	Fair Market Value
Cash	$120,000	$120,000
Machinery	120,000	136,000
Land	208,000	244,000

In exchange, Arthur received 50% of Potato Corporations only class of stock outstanding. All parties believe that the value of the stock Arthur received is the equivalent of the value of the assets he transferred. The only other shareholder, Julianne, formed Potato Corporation nine years ago.

Question 14 options:

	Potato Corporation has a basis of $120,000 in the machinery and $208,000 in the land.
	Arthur has no gain or loss on the transfer.
	Arthur has a basis of $500,000 in the stock of Potato Corporation.
	Potato Corporation has a basis of $196,000 in the machinery and $304,000 in the land.

Question 15 (1 point)

Cucumber Corporation is a calendar year C Corporation formed in 2014. Cucumbers E & P before distributions for each of the past 5 years is listed below.

2018	$24,000
2017	$40,000
2016	$39,000
2015	$68,000
2014	$16,000

Cucumber Corporation made the following distributions in the previous 5 years.

2017	Land (basis of $70,000, fair market value of $80,000)
2014	$50,000 cash

Cucumbers accumulated E & P as of January 1, 2019 is:

Question 15 options:

	$95,000.
	$101,000.
	$105,000.
	$91,000.

Question 16 (1 point)

Rutabaga, a C Corporation, has accumulated E & P of $200,000 on January 1, 2019. In 2019, Rutabaga has current E & P of $130,000 (before any distribution). On December 31, 2019, the corporation distributes $350,000 to its sole shareholder, Jack (an individual). Rutabaga Corporations E & P as of January 1, 2020 is:

Question 16 options:

	$130,000
	$0
	($20,000).
	$100,000.

Question 17 (1 point)

Biscuit Corporation, a calendar year C Corporation, has a deficit in accumulated E & P of $(400,00) on January 1 and has current year E & P of $325,000. On December 31, Biscuit distributes $350,000 to its sole shareholder, Shirley, who has a basis in her stock of $25,000. As a result of the distribution, Shirley has:

Question 17 options:

	Dividend income of $325,000 and reduces her stock basis to zero.
	Dividend income of $325,000 and capital gain of $25,000.
	Dividend income of $325,000 and no adjustment to stock basis.
	No dividend income, reduces her stock basis to zero, and has a capital gain of $325,000.

Question 18 (1 point)

Apple Corporation, a C Corporation that is not a dealer in securities, realizes taxable income of $60,000 from the operation of its business. Additionally, in the same year, Apple realizes a long-term capital loss of $20,000 from the sale of marketable securities. If the corporation realizes no other capital gains or losses, what is the proper treatment for the $20,000 long-term capital loss on the corporate tax return?

Question 18 options:

	Use $3,000 of the loss to reduce taxable income & carry $17,000 of the capital loss forward for five years.
	Carry the $20,000 capital loss back three years, then forward five years
	Use $3,000 of the loss to reduce taxable income & carry $17,000 of the capital loss back three years, then forward five years.
	Use $20,000 of the long-term capital loss to reduce current taxable income.