Answered step by step
Verified Expert Solution
Question
1 Approved Answer
True or False 1. John owns 90% of X Corp. and his friend Bob owns 10% of X Corp. X liquidates, pursuant to a plan
True or False 1. John owns 90% of X Corp. and his friend Bob owns 10% of X Corp. X liquidates, pursuant to a plan of liquidation. John will inherit 90% of X' E& P. 2. X Corporation redeemed 10 shares of X stock from individual shareholder A in exchange for $ 5000, in a transaction that qualified as a qualified redemption. A's adjusted basis in the 10 shares is $3000 ($300 per share). X' had $1000 of E& P. A will recognize $1000 of capital gain and a $1000 dividend. 3. X Corp distributes property fair market value (FMV) $100, adjusted basic $50 subject to a liability of $110. X will recognize $60 gain as a result of the transaction.
1. John owns 90% of X Corp. and his friend Bob owns 10% of X Corp. X liquidates, pursuant to a plan of liquidation. John will inherit 90% of X' E& P.
2. X Corporation redeemed 10 shares of X stock from individual shareholder A in exchange for $ 5000, in a transaction that qualified as a qualified redemption. A's adjusted basis in the 10 shares is $3000 ($300 per share). X' had $1000 of E& P. A will recognize $1000 of capital gain and a $1000 dividend.
3. X Corp distributes property fair market value (FMV) $100, adjusted basic $50 subject to a liability of $110. X will recognize $60 gain as a result of the transaction.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started