Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. please help: if orange corp. distributed $10,000 t

Please help: If Orange Corp. distributed $10,000 to Nicholas on March 1, 2020, what is...

80.2K

Verified Solution

Question

Accounting

image

Please help:

If Orange Corp. distributed $10,000 to Nicholas on March 1, 2020, what is Nicholas' stock basis at the end of 2020 (after all 2020 basis adjustments are made)?

**(I answered this for 2 times, both $8,500 and $22,000 are not correct.)

Nicholas owns 60% of the shares of Orange Corp. (an S corporation with no accumulated E&P). Nicholas purchased his shares at the beginning of 2020 for $1,000. Orange Corp. reported the following during 2020: Ordinary business income: $40,000 Separately stated income items: $3,000 Separately stated loss items: $8,000 In addition, Orange Corp. paid off corporate debt (nonrecourse) of $10,000 in 2020

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