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alexdok [17]
2 years ago
8

Small Company was liquidated in the current year by Parent Company, its sole shareholder. Parent received the following assets o

n June 15 pursuant to the liquidation: Basis to Fair Small Market Value Cash $100,00o$100,000 Accounts receivable 40,000 40,000 Plant assets (net) 70,000 90,000 Land (mortgage on land $40,000)90,000 110.000 Total $300,00o$340,000 Also pursuant to the liquidation, Parent assumed the mortgage of $40,000 on the land. Parent Corporation's basis in Small common stock is $205,00O. What are the amount and the character of the gain or loss Parent must recognize from the liquidation? $95.000 capital gain. KE $135.000 capital gain. IN $340.000 dividend
Business
1 answer:
zlopas [31]2 years ago
6 0

Answer:

$95,000 Capital Gain

Explanation:

First, note that during liquidation, the fair market value should be used for the valuation of assets

<u>Step 1: Calculate the Net Assets taken over at Fair Market Value</u>

Total Assets at the Market Value = $340,000

Subtact: Liabilities (land Mortgage) = ($40,000)

The Net Asset at Fair market value = $300,000

Step 2: Calculate the Capital Gain  or loss from the Liquidation

fair Value of Net Assets Taken Over              = $300,000 (from step 1)

Subtract: The Common stock of Small Com. = ($205,000)

The Capital Gain                                              = $95,000

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3 0
1 year ago
Which of the following is NOT part of the simple circular flow model?
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Answer:

<u>The correct answer is B. Government</u>

Explanation:

There is no doubt that the simple circular flow model explains supply and demand in an elemental economic perspective, however this model doesn’t take into account at least five other key factors of the economic systems.  Those factors are:  

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3. The taxation system.

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4 0
3 years ago
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Answer:

Letter C is correct. <u>Socially complex; rare.</u>

Explanation:

Organizations are increasingly incorporating ecological sustainability initiatives in their processes and activities, this is mainly due to the phenomenon of social complexity, which is the study of human behavior in several broad and complex circumstances that impact individual and group existence, such as example natural disasters, political movements, marriage practices, emigration patterns and others.

Man is not merely a passive agent, but a searcher for fundamental goals for himself and for society for improvement and survival.

Therefore, it is correct to say that organizations' sustainability initiatives are increasingly present in the current world, and that is why they are not uncommon, because sustainability is already seen as a phenomenon of social complexity, where companies that do not act according to sustainable parameters do not they are well regarded by society, which wants to consume products and services from companies in line with the highest social and environmental standards, which act as an active agent for improving the quality of social life.

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B. The physical count of securities and cash

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An objective is the business's goal and in order to see that the quantity would need to be in a physical sense to see growth over time.

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You are talking with the president of your company about a possible merger. After she finishes speaking, you respond, "If I unde
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The correct answer is -Descriptive.

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