Oreo Corporation has accumulated E&P of $8,000 at the beginning of the current year. During the year (a nonleap year), the c

Question

3 years ago

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Oreo Corporation has accumulated E&P of $8,000 at the beginning of the current year. During the year (a nonleap year), the c

orporation incurs a current E&P deficit of$18,250. The corporation distributes $11,000 on March 20th to Morris, its sole shareholder, who has a $9,000 basis for his stock. If the exact loss cannot be determined as of the date of distribution, the treatment of the distribution will beA.$11,000 return of capital.B.$4,100 dividend and a $6,900 capital gain.C.$8,000 dividend and a $3,000 return of capital.D.$4,100 dividend and a $6,900 tax free return of capita

Business

1 answer:

aliya0001 [1] · Answer 1 · 2022-06-26T18:19:14+03:00

aliya0001 [1]3 years ago

5 0

Answer:

D. $4,100 dividend and a $6,900 tax free return of capital

Explanation: