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Nata [24]
3 years ago
11

A, B and C form X Corporation by transferring the following assets, each of which has been held long-term:

Business
1 answer:
natita [175]3 years ago
8 0

Answer:

Part (a)

For every business, the most important consideration for any non-cash asset contribution is its fair market value. The importance of assets is to generate financial results in future, where the adjusted basis cannot do this. On the contrary, the shareholders are more interested in the basis recognized from such assets as this informs their share of potential profits.

While the value of stocks and cash each contributor received equals to the fair market value of their contributions. it exceeds the amount of their individual adjusted bases held in the assets contributed. This is a gain on the part of the contributing shareholder, hence must be recognized as such.

The calculation of values received can be determined as under.

A)

Common Stock = $15,000 (15)  

Preferred Stock= $5000 (100)  

Cash = $2,000

Total = $22,000  

B)  

Common Stock = $15,000 (15)  

Cash = $15,000

Total = $30,000  

C)  

Common Stock = $10,000 (15)  

Cash = $5,000

X's Note = $35,000

Total = $50,000  

As such A, B and C should recognize financial gains amounting $7,000, $10,000 and $30,000 respective y. As this gain benefits the individual contributors, X Corporation should recognized and amortize the sum of these gains over a decided period of time. The amount of loss would thus be $47,000.

 

Part (b)

The amount of the basis would have been considered under the installment method where the company would only recognize the income earned for any taxable year as a proportion of the payment in the year in which the gross profit realized or to be realized bears to the total price of the property transfer contract.

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I drew the production possibilities frontier curve for both nations, A and B, and attached it.

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3 years ago
After an extensive advertising campaign, the manager of a company wants to estimate the proportion of potential customers that r
spayn [35]

Answer:

1. Referring to Problem , the manager wants to know the value of the population so the manager uses the sample to estimate the population proportion.

a. True

2. Referring to Problem , point estimate of the population proportion is = 0.45.

a. True

3. Referring to problem , the sample proportion is = 0.45.

b. False

4. Referring to Problem, the manager wants to know the value for the population so the manager uses the sample to estimate the population value

b. False

5. Referring to Problem , the parameter of interest is 54/120 = 0.45.

a. True

Explanation:

a) Data and Calculations:

Sample of potential consumers = 120

Proportion of the sample who recognize the product = 54

Confidence level = 95%

Confidence interval = 0.36 to 0.54

Point estimate = 54/120 = 0.45

b) A point estimate of a population parameter estimates the population parameter as a single value.  The point estimate of the sample mean, x, is also the point estimate of the population mean, μ.  To get the sample proportion, one needs to know the population value.  The sample value divided by the population value gives the sample proportion.

7 0
3 years ago
Are perfectly competitive markets allocatively allocatively efficient in the long​ run?
antiseptic1488 [7]
Yes, because firms produce where the marginal benefit to consumers equals the marginal cost of production.
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3 years ago
Here are the data for the past 21 months for actual sales of a particular product:LAST YEAR THIS YEARJanuary 325 260February 440
Ronch [10]

Answer:

Fore cadet for fourth quarter us $1085

Explanation:

One Quarter = 3 months

Demand for quarter 1 = 325 + 440 + 450 = 1215

Quarter Demand in Each Quarter Weighted Forecast

1 1215

2 1280

3 1125

4 1610

5 1010

6 1220

7 1055

8 1085

Weighted moving Average Forecast = ((0.25 * 1010) + (0.25 * 1220) + ( 0.5 * 1055) = 1085

Forecast for the fourth quarter is 1085

7 0
3 years ago
An investor who was not as astute as he believed invested $276,500 into an account 9 years ago. Today, that account is worth $21
Dimas [21]

Answer:

The annual rate of return is -2.83%

Explanation:

The annual rate can be calculated from the formula FV=PV*(1+r)^N

Where FV is the future value of the investment

PV is the amount invested which is $276,500

N is 9 years

213600=276,500*(1+r)^9

213600/276500=(1+r)^9

divide index on both sides by 9

(213600/276500)^1/9=1+r

(213600/276500)^1/9-1=r

r=-0.02827109

r=-2.83%

Hence the annual rate of return on the investment is -2.83%, which means the investment depleted by 2.83% from initial invested amount of $276,5000 to $213,600 after nine years

6 0
3 years ago
Read 2 more answers
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