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Over [174]
3 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]3 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

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Answer:

Predatory pricing.

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The starting point for preparing the operating activities section using the indirect method is ______. Multiple choice question.
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2 years ago
Edgar Co. acquired 60% of Stendall Co. on January 1, 2013. During 2013, Edgar made several sales of inventory to Stendall. The c
rjkz [21]

Answer:

Non-controlling interest in net income decreased would have by $6,000

Explanation:

The computation of net income is shown below:-

Profit on Intra-Entity Sales = Revenue - Cost of goods sold

= $200,000 - $140,000

= $60,000

Profit on Intra-Entity Sales × 25% still in Ending Inventory

= $60,000  × 25%

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= $6,000  

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