Ch2HW1 - D:E 9:1 b Not good Interest only payable from income c Very risky joint liability tough d Only risky for A OK though e At least interest

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Lind page 23, 146 #1, page 157; Anderson 48, 5 48) a) Reggie - $70,000 p23) a) 2,500,000 Jackson - 120,000 100,000 200,000 b) Reggie - 20,000 2,800,000 Jackson - 100,000 = 120,000 - 20,000 -600,000 -800,000 55) a) No. 80% control requirement not met -200,000 -70,000 (100K x 70%) b) Eric - 150,000 = 200 - 50 -130,000 Florence - 25,000 1245 ORD 1,000,000 Taxable Income George - 0 Gain - 25,000 ORD 34% Wildcat - 0 Gain 340,000 Tax Liability c) Eric - 50,000 All day b) 1,000,000 Florence - 25,000 after -660,000 George 25,000 exchange 340,000 d) Land B - 50,000 All day c) 1,000,000 Equip B - 25,000 after -1,000,000 Services 25,000 exchange 0 p146) a) Likely to Reclass
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Unformatted text preview: D:E 9:1 b) Not good. Interest only payable from income c) Very risky, joint liability tough. d) Only risky for A. OK though. e) At least interest is only problem, maybe principal will be OK. p157) a) Would be STCL where loss is non-bus bad debt. No growth potential. b) CL if worthless. No growth potential. c) CL. Upside potential for growth. d) Potential for growth, but less secure. e) More predictable than CS, better security, little growth potential. f) No 1244 treatment, capital @ 1,000,000 g) No 1244, only for original issue, no gift. h) OK....
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This note was uploaded on 10/06/2008 for the course ACC 600 taught by Professor Livingstone during the Spring '08 term at UNC Greensboro.

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