Q

IntroductionAfter reading about the formation, operation, capital structure, and liquidation of corporations and estate and gift tax planning, you will complete textbook exercises so that you may develop your skills relevant to real world conceptual, practical, and technical applications.

1. InstructionsDownload the exercises assignment sheet and answer sheet template provided inResources(above). These will identify the exercises in the textbook to be completed.
2. Using the answer sheet template enter formulas or numbers required to complete the exercise. If the questions require a written component, enter your written responses in the area indicated.

Type your name here------> Points earned --> 50 Read the instructions and hints before attempting to complete the solution. Enter your responses and answers in the areas specified. There are 50 total points for this assignment. The point value of each exercise is determined by dividing the 50 points by the number of exercises per assignment. If you have difficulty with any of the exercises, take advantage of the collaboration discussion forum. Workshop 6 12 Corporations: formation, operation, capital structure, and liquidation 1, 2, 3 18 Estate and Gift Tax Planning 1, 2 Chapter 12 Exercise 1 points possible 10 deductions Points earned 10 1. Which of the following scenarios will qualify under Section 351 as a nontaxable corporate formation? For those that do not qualify, what requirement of Section 351 do they violate? a. Ginger, Mary Ann, and Mrs. Howell form GMH Corp. Ginger contributes memorabilia in exchange for 40% of GMH's stock, Mary Ann contributes farmland in exchange for 30% of GMH, and Mrs. Howell contributes cash in exchange for the remaining 30%. b. Clyde founded ABC Corp. in 2009 and owns all of ABC's 1,000 shares of outstanding stock. In 2013, ABC issues 300 shares of new stock to Bonnie in exchange for land that Bonnie owned. Will Bonnie's contribution qualify under Section 351? c. With the same facts as part b, now ABC issues 4,500 shares of new stock to Bonnie in exchange for Bonnie's land. d. Bert and Ernie form Duckie Corp. in late 2013. Bert contributes $10,000 cash in exchange for 60% of Duckie's stock; Ernie contributes services in exchange for the remaining 40% of Duckie. a. Ginger, Mary Ann, and Mrs. Howell form GMH Corp. Ginger contributes memorabilia in exchange for 40% of GMH's stock, Mary Ann contributes farmland in exchange for 30% of GMH, and Mrs. Howell contributes cash in exchange for the remaining 30%. Yes or No and explain. type your response here. b. Clyde founded ABC Corp. in 2009 and owns all of ABC's 1,000 shares of outstanding stock. In 2013, ABC issues 300 shares of new stock to Bonnie in exchange for land that Bonnie owned. Will Bonnie's contribution qualify under Section 351? Yes or No and explain. type your response here. b. Clyde founded ABC Corp. in 2009 and owns all of ABC's 1,000 shares of outstanding stock. In 2013, ABC issues 300 shares of new stock to Bonnie in exchange for land that Bonnie owned. Will Bonnie's contribution qualify under Section 351? Yes or No and explain. type your response here. c. With the same facts as part b, now ABC issues 4,500 shares of new stock to Bonnie in exchange for Bonnie's land. Yes or No and explain. type your response here. d. Bert and Ernie form Duckie Corp. in late 2013. Bert contributes $10,000 cash in exchange for 60% of Duckie's stock; Ernie contributes services in exchange for the remaining 40% of Duckie. Yes or No and explain. type your response here. Exercise 2 points possible 10 deductions Points earned 10 2. Conan and Andy decide to form a new corporation, LN Corp. Conan contributes property with a basis of $10,000 and a fair market value of $18,000 in exchange for 5 shares of LN stock and $13,000 in cash, which LN borrows from a bank to finance. Andy contributes property with a basis of $35,000 and a fair market value of $80,000 in exchange for 80 shares of LN stock. a. How much taxable gain or loss will Conan recognize as a result of the transaction? b. What basis will Conan take in the LN stock he receives? a. How much taxable gain or loss will Conan recognize as a result of the transaction? Tax gain=min=