Distribution of loss property by an s corporation to

This preview shows page 21 - 25 out of 56 pages.

We have textbook solutions for you!
The document you are viewing contains questions related to this textbook.
Quantitative Methods for Business
The document you are viewing contains questions related to this textbook.
Chapter 2 / Exercise 4
Quantitative Methods for Business
Anderson/Sweeney
Expert Verified
136. Distribution of loss property by an S corporation to a shareholder generally should be _________________. ________________________________________137. Depletion in excess of basis in property causes a(n) ____________________ adjustment to an S shareholder’s basis. ________________________________________138. Stock basis first is increased by income items, then ____________________ by distributions, and finally decreased by ____________________. ________________________________________
We have textbook solutions for you!
The document you are viewing contains questions related to this textbook.
Quantitative Methods for Business
The document you are viewing contains questions related to this textbook.
Chapter 2 / Exercise 4
Quantitative Methods for Business
Anderson/Sweeney
Expert Verified
139. If an S corporation shareholder’s basis in a loan to the entity has been _________________, the shareholder recognizes gross income when the S corporation repays the shareholder. ________________________________________140. With respect to passive losses, there are three classes of income, losses, and credits: ____________________, ____________________, and passive. ________________________________________141. An S corporation’s LIFO recapture amount equals the excess of the inventory’s value under ____________________ over the ____________________ value. ________________________________________142. The § 1202 exclusion of _________________ on the disposition of small business stock (is/is not) _________________ available for S stock. ________________________________________143. Estela, Inc., a calendar year S corporation, incurred the following items in 2013.Municipal bond interest$ 7,000 Sales120,000 Depreciation recapture income14,000 Long-term capital gain20,000 Cost of goods sold(42,000)Administrative expenses(15,000)Depreciation expense(13,000)Charitable contributions(10,000)Calculate Estela’s nonseparately computed income.
144. Towne, Inc., a calendar year S corporation, holds AAA of $627,050 at the beginning of 2013. During the year, the following items occur.Sales income $216,000 Loss from real estate operations(4,000)Officers’ life insurance proceeds100,000 Premiums paid for officers’ life insurance(3,600)Dividend income17,000 Interest income3,000 Charitable contributions(22,000)§ 179 depreciation expense(2,500)Administrative expenses(35,000)Cash distributions to shareholders(73,220)Calculate Towne’s ending AAA balance.145. Bidden, Inc., a calendar year S corporation, incurred the following items.Sales$130,000 Depreciation recapture income12,000 Short-term capital gain30,000 Cost of goods sold(42,000)Municipal bond interest income7,000 Administrative expenses(15,000)Depreciation expense(17,000)Charitable contributions(14,000)Calculate Bidden’s nonseparately computed income.
146. Gene Grams is a 45% owner of a calendar year S corporation during 2013. His beginning stock basis is $230,000, and the S corporation reports the following items.Ordinary income$72,000 Short-term capital gain16,000 § 1231 loss6,000 Tax-exempt interest income5,000 Calculate Grams’s stock basis at year-end.147. Chris, the sole shareholder of Taylor, Inc., elects during 2013 to terminate the S election, effective January 1, 2014. As of the end of 2013, Taylor, Inc., holds AAA of $120,000 and OAA of $13,000. Chris receives a cashdistribution of $130,000 on January 15, 2014. If his stock basis is $220,000 before the distribution, calculate Chris’s taxable amount and his ending stock basis. 148. Individuals Adam and Bonnie form an S corporation, with Adam contributing cash of $100,000 for a 50% interest, and Bonnie contributing appreciated ordinary income property with an adjusted basis of $20,000 and a fair market value of $100,000.a.Determine Bonnie’s initial basis in her stock, assuming that she receives a 50% interest.b.The S corporation sells the property for $120,000. Determine Adam’s and Bonnie’s stock basis after the sale.c.Determine Adam’s and Bonnie’s gain or loss if the company is liquidated.

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture

  • Left Quote Icon

    Student Picture