Lone Star Company is a calendar-year corporation, and this year Lone Star reported $120,000 in...
80.2K
Verified Solution
Link Copied!
Question
Accounting
Lone Star Company is a calendar-year corporation, and this year Lone Star reported $120,000 in current E&P that accrued evenly throughout the year. At the beginning of the year, Lone Stars accumulated E&P was $15,600. At the beginning of the year, Lone Stars sole shareholder was Matt McCon. Lone Star declared $34,800 in cash distributions on each of the following dates: March 31, June 30, September 30, and December 31. (Leave no answer blank. Enter zero if applicable. Negative amount should be indicated by a minus sign.)
a) How much of the $139,200 in total distributions will be treated as dividends?
b) Suppose that Matt sold half of his shares to Chris Coop on June 1st for $50,000. How much dividend income will Matt recognize this year?
c) If Matts basis in his Lone Star shares was $8,000 at the beginning of the year, how much capital gain will he recognize on the sale and distributions from Lone Star?
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!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.