This answer utilizes the propertys cost as the

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Unformatted text preview: ss income for the year is investment-type income. Choice "a" is incorrect. A PHC is subject to the regular tax on corporate income as well as a 15% tax on its undistributed PHC income. Choice "b" is incorrect. As a personal holding company, Acme is not subject to the accumulated earnings tax. Choice "c" is incorrect. A regulated investment company must be registered under the Investment Company Act of 1940 or file an election to be a regulated investment company. CPA-02158 Type1 M/C A-D Corr Ans: B PM#79 R 3-01 61. CPA-02158 PII May 93 #53 Page 3 In 19X2, Stone, a cash basis taxpayer, incorporated her CPA practice. No liabilities were transferred. The following assets were transferred to the corporation: Cash (checking account) Computer equipment Adjusted basis Fair market value Cost $ 500 30,000 34,000 40,000 Immediately after the transfer, Stone owned 100% of the corporation's stock. The corporation's total basis for the transferred assets is: a. b. c. d. $30,...
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