Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. 3. three individuals form skylark corporation with

3. Three individuals form Skylark Corporation with the following contributions: Cliff, cash of $50,000 for...

50.1K

Verified Solution

Question

Accounting

3. Three individuals form Skylark Corporation with the following contributions: Cliff, cash of $50,000 for 50 shares; Brad, land worth $20,000 (basis of $11,000) for 20 shares; and Ron, cattle worth $9,000 (basis of $6,000) for 9 shares and services worth $21,000 for 21 shares.

a.

These transfers are fully taxable and not subject to 351.

b.

Rons basis in his stock is $27,000.

c.

Rons basis in his stock is $6,000.

d.

Brads basis in his stock is $20,000.

4. Rose Corporation (a calendar year taxpayer) has taxable income of $300,000, and its financial records reflect the following for the year.

Federal income taxes paid

$110,000

Net operating loss carryforward deducted currently

70,000

Gain recognized this year on an installment sale from a prior year

44,000

Depreciation deducted on tax return (ADS depreciation would have been $10,000)

40,000

Interest income on Iowa state bonds

8,000

Rose Corporations current E & P is:

a.

$254,000.

b.

$214,000.

c.

$194,000.

d.

$104,000.

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students