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. DCC's tax accounting balance sheet at the date of liquidation is as follows: Adjusted Basis FMV $ 44,99 $ 44,888 24.ee 24,000 24,99 48 , 51, eee 34,080 24,99 48,888 6,80e 48,080 173,000 $246,000 $ Assets Cash Accounts receivable Inventory Equipment Building Land Total assets Liabilities Accounts payable Mortgage payable-Building Mortgage payable-Land Total liabilities Shareholders' Equity Common stock-Rex (80%) Common stock-Felix (20%) Total shareholders equity $ 61,888 30, eee 30,wee $121,080 $100,000 25,00 $125,000 Required: a. 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 corporation's assets and assumes a pro rata amount of the liabilities. b. Compute the gain or loss recognized by DCC. Rex, and Felix on a complete liquidation of the corporation assuming that Felix received cash in lieu of his pro rata share of assets and liabilities. For parts c and d: Assume Felix received the accounts receivable and equipment and assumed the accounts payable. c. Will Felix recognize any income when he collects the accounts receivable? d. 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. e. 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 corporation's assets and assumes a pro rata amount of the liabilities. t. Compute the gain or loss recognized by Rex, Felix, and DCC on a complete liquidation of the corporation assuming Felix receives $39.000 in cash and Rex receives the remainder of the assets and assumes all of the liabilities