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alekssr [168]
4 years ago
8

Tracy and Lance, equal shareholders in Macaw Corporation, receive $600,000 each in distributions on December 31 of the current y

ear. Macaw’s current year taxable income is $1 million and it has no accumulated E & P. Last year, Macaw sold an appreciated asset for $1,200,000 (basis of $400,000). Payment for one-half of the sale of the asset was made this year. How much of Tracy’s distribution will be taxed as a dividend?A. $0B. $300,000C. $500,000D. $600,000E. None of the above
Business
1 answer:
Lorico [155]4 years ago
6 0

Answer:

B. $300,000

Explanation:

Macaw Corporation increased its E & P last year for the entire amount of the deferred gain on the installment sale. Since one-half of the $800,000 gain is included in taxable income in the current year, taxable income should be reduced by this amount to determine current E & P. Therefore, Macaw Corporation’s current year E & P is $600,000 ($1 million taxable income – $400,000 of installment sale gain). Because one-half of the current E & P is allocated to Tracy’s distribution, she has a $300,000 dividend

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Answer:

Debit Cash and Interest Expense; Credit Notes Payable.

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3 years ago
A large personal care products company adopts a(n) ________ approach to gain a competitive edge in light of intense foreign comp
lawyer [7]

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"Total quality management " is the correct answer.

Explanation:

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In the town of New Era, Mary, Scott, and Fredo are all running for the same spot on the village council. New Era residents care
daser333 [38]

Answer:

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4 0
3 years ago
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D

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• competition among producers

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3 years ago
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Answer:

Explanation:

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