CER - devry -Acct424Week 3 Quiz3

Each member keeps its own e p account correct

Info icon This preview shows pages 2–5. Sign up to view the full content.

View Full Document Right Arrow Icon
Each member  keeps its own E &  P account. CORRECT Instructor Explanation: There is no such concept as consolidated E & P.   Points Received: 2 of 2
Image of page 2

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Image of page 3
7. Question: (TCO 5) Julio exchanged his $350,000 of bonds and $75,000 of stock (basis $10,000) in Calcite  Corporation for $50,000 of stock and $375,000 in bonds Mercury Corporation.  What is Julio’s recognized  gain or loss, and what is Julio’s basis in his stock? Your Answer: Julio has a  recognized gain of  $25,000 and a basis  in his stock of  $10,000. CORRECT Julio has a  recognized gain of  $25,000 and a basis  in his stock of  $40,000. Julio has a  recognized loss of  $25,000 and a basis  in his stock of  $40,000. Julio has a realized  loss of $25,000, no  recognized loss, and  a basis in his stock  of $40,000. None of the above. Instructor Explanation: Julio recognizes gain to the extent that the principal amounts of the bonds received are in excess of the  bonds given up, $25,000.  This recognition does not affect Julio’s basis in his stock.   Points Received: 2 of 2 8. Question: (TCO 5) To qualify as a tax-free reorganization, a restructuring must meet the specific requirements of  § 368 and all of the following  except :
Image of page 4

Info icon This preview has intentionally blurred sections. Sign up to view the full version.

View Full Document Right Arrow Icon
Your Answer: Instructor Explanation: All of these are requirements for tax-free treatment of reorganizations.  Points Received: 2 of 2
Image of page 5
This is the end of the preview. Sign up to access the rest of the document.

{[ snackBarMessage ]}

What students are saying

  • Left Quote Icon

    As a current student on this bumpy collegiate pathway, I stumbled upon Course Hero, where I can find study resources for nearly all my courses, get online help from tutors 24/7, and even share my old projects, papers, and lecture notes with other students.

    Student Picture

    Kiran Temple University Fox School of Business ‘17, Course Hero Intern

  • Left Quote Icon

    I cannot even describe how much Course Hero helped me this summer. It’s truly become something I can always rely on and help me. In the end, I was not only able to survive summer classes, but I was able to thrive thanks to Course Hero.

    Student Picture

    Dana University of Pennsylvania ‘17, Course Hero Intern

  • Left Quote Icon

    The ability to access any university’s resources through Course Hero proved invaluable in my case. I was behind on Tulane coursework and actually used UCLA’s materials to help me move forward and get everything together on time.

    Student Picture

    Jill Tulane University ‘16, Course Hero Intern