1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Over [174]
2 years ago
5

Harry, Hermione, and Ron formed an S corporation called Bumblebore. Harry and Hermione both contributed cash of $40,300 to get t

hings started. Ron was a bit short on cash but had a parcel of land valued at $98,000 (basis of $80,600) that he decided to contribute. The land was encumbered by a $57,700 mortgage. What tax bases will each of the three have in his or her stock of Bumblebore
Business
1 answer:
Kitty [74]2 years ago
5 0

Answer:

The correct answer is $40,300, $40,300 and $22,900

Explanation:

According to the scenario, the given data are as follows:

Harry contributed = $40,300

Hermione contributed = $40,300

Ron contributed land value = $98,000

Basis of land = $80,600

Mortgage on land = $57,700

So, we can calculate the tax basis for each by using following method:

Tax basis of Harry =  Harry contributed cash

Tax basis of Harry = $40,300

Tax basis of Hermione =  Hermione contributed cash

Tax basis of Hermione = $40,300

Tax basis of Ron = Basis of land - Mortgage on land

= $80,600 - $57,700

= $22,900

You might be interested in
Joe Dumars Company has outstanding 40,000 shares of $5 par common stock which had been issued at $30 per share. Joe Dumars then
satela [25.4K]

Answer:

<u>Transaction 1</u>

Assets - Decrease by $225,000

Cash expended to acquire shares = 5,000 * 45 = $225,000

Liabilities - No effect

Stockholders' equity - Decrease by $225,000

Increase in Treasury shares leads to decrease in the amount stockholders hold.

Paid In Capital - No effect

Retained Earnings - No Effect

Net Income - No Effect

<u>Transaction 2</u>

Assets - Increase by $98,000

Cash increased because of sale of stock = 2,000 * 49 = $98,000

Liabilities - No effect

Stockholders' equity - Increase by $90,000

= 2,000 * 45 = $90,000

Cost method means that when debiting from Treasury account, use original cost.

Paid In Capital - Increase by $8,000

If stock is sold for amount different from what it was bought, it goes into this account. If it is larger than it was bought for then this account increases and vice versa.

Retained Earnings - No Effect

Net Income - No Effect

<u>Transaction 3</u>

Assets - Increase by $20,000

Cash from sale of stock = 500 * 40 = $20,000

Liabilities - No effect

Stockholders' equity - Increase by $22,500

= 500 * 45 = $22,500

Paid In Capital - Decrease by $2,500

If stock is sold for amount different from what it was bought, it goes into this account. If it is smaller than it was bought for then this account decreases and vice versa.

Retained Earnings - No Effect

Net Income - No Effect

4 0
3 years ago
If the four largest firms in an industry produce 20, 10, 7, and 3 units of output, respectively, and total industry output is 10
GrogVix [38]

Answer:

40%

Explanation:

The four firm concentration ratio calculates the concentration ratio of the 4 largest firms in an industry.

Four firm concentration ratio = 0.2 + 0.1 + 0.07 + 0.03 = 0.4 = 40%

7 0
2 years ago
Gemini Inc. has prepared a market plan for its air conditioners. The managers at Gemini have outlined several activities for the
Westkost [7]

The correct answer is C) implementation.

Gemini Inc. has prepared a market plan for its air conditioners. The managers at Gemini have outlined several activities for their subordinates based on a marketing plan. The employees are required to finish these activities within specific time frames. The managers have also allocated a budget for each activity. In the context of marketing planning, the concept that illustrates the scenario is<u><em> implementation.</em></u>

When talking about the marketing plan, the first stage in the planning where managers establish the goals, the strategies and tactics to reach those goals. Those strategies and tactics come to reality in the implementation stage, when management gives every department and employee the activities they need to do in order to accomplish the goals. The implementation is the operative part that has to be done in the allocated time and within the budgetary restriction to fulfill the programs and accomplish goals.

8 0
3 years ago
Flesch Corporation produces and sells two products. In the most recent month, Product C90B had sales of $37,000 and variable exp
andre [41]

Answer:

The BEP will decrease, which is good.

The reason is that C90B has a better profit margin than Y45E so if the sales shift toward C90B the Contribution mix margin ratio will be higher and it will be easy to pay fixed cost and make a gain

Explanation:

C90B

sales  37,000

variable expenses 9,250

contribution margin 27,750

CM 0.75

Y45E

sales 29,700

variable expenses 16,335

contribution 13,365

CM 0.45

7 0
3 years ago
Successive waves of globalization include characteristics such as the expansion of trade, the diffusion of technology, extensive
Jlenok [28]

Answer:

E) cross-fertilization of diverse cultures

Explanation:

Cross-fertilization of diverse cultures refers to several cultures mixing together and the result of that mix is that the best qualities or characteristics of each culture are absorbed by the other cultures.

This is a similar concept to the melting pot theory in the US, where diverse immigrants interacted together and they were able to get the best out of each other's culture.

3 0
2 years ago
Other questions:
  • Software development process that develops software iteratively with a heavy emphasis on construction activities is known as
    14·1 answer
  • An increase in ________ will increase operating cash flow for a profitable
    15·1 answer
  • Vaughn Inc. acquired all of the outstanding common stock of Roberts Co. on January 1, 2020, for $276,000. Annual amortization of
    14·1 answer
  • Experienced trainers prepare a complete set of notes that they read to trainees to make sure that no important material is omitt
    11·1 answer
  • LO 8.4What is the main difference between a flexible budget and a master budget?
    13·1 answer
  • Shauna and Danielle decided to liquidate their jointly owned corporation, Woodward Fashions Inc. (WFI). After liquidating its re
    6·1 answer
  • In a company that employs continuous budgeting on a quarterly basis and has an accounting period that ends December 31 of each y
    11·1 answer
  • Lemon company purchased 100 units for $20 each on January 31. It purchased 200 units for $30 each on February 28. It sold 200 un
    11·1 answer
  • Deadweight losses occur when the quantity of an output produced is:
    12·1 answer
  • The business cycle affects output and employment in capital and durable goods industries more severely than in industries produc
    8·2 answers
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!