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On January 30, Juan receives a nontaxable distribution of stock rights from Platinum Corporation. Each right entitles the holder to purchase one share of stock
- On January 30, Juan receives a nontaxable distribution of stock rights from Platinum Corporation. Each right entitles the holder to purchase one share of stock $60. One right is issued for every share of stock owned. Juan owns 1000 shares of stock purchased two years ago for $10000. At the date of distribution, the rights are worth $5000 (1000 rights at $5 per right) and Juan's stock in Platinum is worth $5000 (or $50 per share) On December 1, Juan sells all 100 stock rights for $12 per right. How much gain does Juan recognize on the sale?
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Management And Cost Accounting
Authors: Mike Tayles, Colin Drury
11th Edition
147377361X, 978-1473773615
