Here 15000 accumulated ep 15000 remaining distribution

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Unformatted text preview: 0,000 of the distribution. Choice "c" is incorrect. The corporation had accumulated earnings and profits of $60,000 that must also be considered. Choice "d" is incorrect. Distributions from a corporation to its shareholders are considered dividend income to the extent the corporation has current and accumulated earnings and profits. Any additional amounts are a return of capital and any excess beyond capital are considered capital gain. CPA-04731 Type1 M/C A-D Corr Ans: D PM#85 R 3-01 66. CPA-04731 Released 2005 Page 39 Bridge, a C corporation, had $15,000 in accumulated earnings and profits at the beginning of the current year. During the current year, Bridge reported earnings and profits of $10,000 and paid $20,000 in cash distributions to its shareholders in both March and July. What amount of the July distribution should be classified as dividend income to Bridge's shareholders? a. b. c. d. $20,000 $15,000 $10,000 $5,000 29 © 2009 DeVry/Becker Educational Development Corp. All rights reserved. Max...
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This note was uploaded on 06/14/2013 for the course ACCOUNTING Regulation taught by Professor Becker during the Fall '10 term at Keller Graduate School of Management.

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