Rex and Felix are the sole shareholders of Dogs and Cats Corporation (DCC). After several years of operations using the accrual method, they decided to liquidate the corporation and operate the business as a partnership. Rex and Felix hired a lawyer to draw up the legal papers to dissolve the corporation, but they need some tax advice from you, their trusted accountant. They are hoping you will find a way for them to liquidate the corporation while minimizing their total income tax liability. Rex has a tax basis in his shares of $60,000 and Felix has a tax basis in his shares of $30,000. DCCs tax accounting balance sheet at the date of liquidation is as follows: Adjusted Basis FMV Assets Cash $ 30,000 $ 30,000 Accounts receivable 10,000 10,000 Inventory 10,000 20,000 Equipment 30,000 20,000 Building 15,000 30,000 Land 5,000 40,000 Total assets $ 100,000 $ 150,000 Liabilities Accounts payable $ 5,000 Mortgage payableBuilding 10,000 Mortgage payableLand 10,000 Total liabilities $ 25,000 Shareholders Equity Common stockRex (80%) $ 60,000 $ 100,000 Common stockFelix (20%) 30,000 25,000 Total shareholders equity $ 90,000 $ 125,000 Required: Compute the gain or loss recognized by Rex, Felix, and DCC on a complete liquidation of the corporation assuming each shareholder receives a pro rata distribution of the corporations assets and assumes a pro rata amount of the liabilities. Compute the gain or loss recognized by Rex, Felix, and DCC on a complete liquidation of the corporation assuming Felix receives $25,000 in cash and Rex receives the remainder of the assets and assumes all of the liabilities. For parts c and d: Assume Felix received the accounts receivable and equipment and assumed the accounts payable. Will Felix recognize any income when he collects the accounts receivable? Will Felix be able to take a deduction when he pays the accounts payable? For parts e and f: Assume Rex is a corporate shareholder of DCC. Compute the gain or loss recognized by Rex, Felix, and DCC on a complete liquidation of the corporation assuming each shareholder receives a pro rata distribution of the corporations assets and assumes a pro rata amount of the liabilities. Compute the gain or loss recognized by Rex, Felix, and DCC on a complete liquidation of the corporation assuming Felix receives $25,000 in cash and Rex receives the remainder of the assets and assumes all of the liabilities