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abruzzese [7]
3 years ago
14

Puffin Corporation makes a property distribution to its sole shareholder, Bonnie. The property distributed is a car (basis of $3

0,000; fair market value of $20,000) that is subject to a $6,000 liability which Bonnie assumes. Puffin has no accumulated E & P and $30,000 of current E & P from other sources during the year. What is Puffin’s E & P after taking into account the distribution of the car?
Business
1 answer:
Svetllana [295]3 years ago
5 0

Answer:

Puffin’s E & P after taking into account the distribution of the car is $6,000.

Explanation:

E & P will be decreased by the higher of the adjusted basis or the fair market value of the distributed property, net of any liabilities. The distribution losses will not be taken into consideration when determining E & P. Thus the current E & P of Puffin’s $30,000 is reduced by $24,000 ($30,000 basis of the car minus the liability amount). The remaining after the distribution current E & P will be $6,000.

Therefore, Puffin’s E & P after taking into account the distribution of the car is $6,000.

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Select the incorrect statement regarding the relationship between cost behavior and profits.
givi [52]

Answer:

C. In a pure fixed cost structure, the unit selling price and unit contribution margin are equal.

Explanation:

In Accounting, cost behavior is an indication of how costs in a firm reacts to change in activity levels. There are basically three types of cost behavior; fixed costs, variable costs and semi-variable costs.

The relationship between cost behavior and profits are;

- A pure fixed cost structure offers more security if volume expectations are not achieved.

- In a pure variable cost structure, when revenue increases by $1, so do profits.

- A pure variable cost structure offers higher potential rewards.

3 0
3 years ago
As a function of management, "facilitating" is:
lianna [129]

Answer:

c

Explanation:

C) A reference to both the motivating and leadership functions.

Facilitating means solving the problems of the employees and help them move ahead. So, one must motivate employees and well as lead them through the tough times. So this comes under motivating and leadership function.  

8 0
3 years ago
"An individual owns a bicycle repair business as a sole proprietorship. He does not make a lot of money, but he does have $5,000
ICE Princess25 [194]

Answer:

Roth IRA

Explanation:

Based on the information provided in this scenario it can be said that the individual's best option would be to make a $5,000 contribution to a Roth IRA fund. This is a retirement fund that can be will provide will continue to grow exponentially throughout the years and the individual can withdraw that money when they turn 60 years old. At this point the money is completely tax free.

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3 years ago
The government of a country increased the minimum wage from $21 to $30. A factory owner had to lay off some of his workers becau
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8 people would lose their jobs.
3 0
3 years ago
Read 2 more answers
Seller Jones signed an exclusive right to sell listing on her home with Muller Realty for $155,000 at a commission rate of 5% to
kramer

Answer:

$3,875

Explanation:

Data given in the question

Selling value of the home = $155,000

Commission rate = 5%

Share basis = equally

So, by considering the above information, the Muller received amount is

= Selling value of the home × commission rate ÷ share basis

= $155,000 × 5% ÷ 2

= $7,750 ÷ 2

= $3,875

By considering the all the information given in the question we can easily find out the received amount by the Muller

8 0
3 years ago
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