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
musickatia [10]
3 years ago
15

Tracy transfers property with a value of $60,000 and adjusted basis of $50,000 to form Riley Corp. solely in exchange for all 10

0 shares of Riley stock valued $60,000. What is Riley Corp.'s basis in the property
Business
1 answer:
Olin [163]3 years ago
4 0

Answer:

$60,000

Explanation:

Tracy's basis on the transfer is $50,000 and the amount realized is $60,000.

So Tracy should have a realized gain of $10,000, but Section 351 states that no gain or loss must be recognized when one person transfers property in exchange for a corporation's stock if immediately after the transfer, the person controls the corporation. In this case, Tracy will own 100% of Riley Corp., so she doesn't have to recognize any gain.

Riley Corp.'s basis on the property will be $60,000 which is equal to the fair market value and the value realized by Tracy.

You might be interested in
This year Lloyd, a single taxpayer, estimates that his tax liability will be $11,350. Last year, his total tax liability was $15
Dmitrij [34]

Answer:

Lloyd needs to increase his witholding tax to $1,560 this year in order to avoid the underpayment penalty .

Explanation:

As a rule, a citizen can maintain a strategic distance from an underpayment of punishment if their retention and evaluated assessment installment measure up to or surpass one of the two safe harbours

90% of current expense risk = 90% × $11,350

= $10,215

100% of past assessment risk = $15,900

Since his(Lloyd) retention is not equal to or exceed $10,215 or $15,900

Llyod should expand retaining or make payment this year in order to stay away from underpayment punishment

= $10,215 - $8,655

= $1,560

3 0
3 years ago
In January, 2020, Harmony Inc. has the following expenditures related to manufacturing a new generation of widgets. Match each e
Ivan

Answer:

Harmony Inc.

Expenditure                                          Appropriate accounting treatment

a. Machinery $550,000                       B. Capitalize to the Machine  

b. Machinery $33,000                          B. Capitalize to the Machine

Research and development $95,000 D. Expense.

c. Freight-in (Machinery) $4,250         B. Capitalize to the Machine

d. Installation, etc (Machinery) $16,500 B. Capitalize to the Machine

e. Prepaid Insurance $3,000               A. Capitalize to a different asset account.  

Explanation:

1) Data and Analysis:

a. Machinery $550,000 Accounts payable $550,000

b. Machinery $33,000 Sales Tax Expense $33,000

Research and development $95,000 Cash $95,000

c. Freight-in (Machinery) $4,250 Accounts payable $4,250

d. Installation (Machinery) $16,500 Cash $16,500

e. Prepaid Insurance $3,000 Cash $3,000

b) The correct approach in capitalizing fixed assets and related costs is to follow this procedure: capitalize freight, sales tax, transportation, and installation, in addition to the fixed asset purchase cost.

7 0
2 years ago
Alton works in Energy Transmission. At which location could Alton possibly work?
vovangra [49]
He could possibly work on power lines because it used electrify with creates energy transmission
7 0
3 years ago
Read 2 more answers
Can the dichotomy of jefferson as democrat and slaveholder be seen to represent the gap between ideal and practice?
otez555 [7]
<span>The fact that Jefferson owned slaves which holding the belief that slavery was immoral and wrong perfectly illustrates the gap between ideals and practices. Jefferson's worked for years to help end the slave trade and ultimately criminalized international slave trade while president. This shows that his ideals were against slavery. However, in personal practice, most of Jerfferson's wealth stemmed from the slaves that operated his family's plantation.</span>
8 0
3 years ago
The following information is available for Armstrong Company: Net income $450 Increase in plant and equip. $170 Depreciation exp
strojnjashka [21]

Answer:

$505

Explanation:

Armstrong Company

Cash flow from operating activities

Adjustments to reconcile net income to operating cash flow.

Net income

$450

Less : Increase in plant and equipment

($170)

Add : Depreciation expenses

$80

Add : Payment of dividends

$10

Add : Decrease in accounts receivable

$20

Add : Increase in long term debt

$100

Less : Increase in Inventories

($15)

Add : Decrease in Account payable $30

Net Cash flow from operating activities

$505

8 0
3 years ago
Other questions:
  • Identify an expansionary fiscal policy. increasing personal taxes increasing government spending buying government securities in
    13·1 answer
  • When your music teacher asks that you increase the decibels in a particular part of your performance, he is specifically request
    10·1 answer
  • Economic profits are Multiple Choice always larger than accounting profits. the sum of accounting profits and implicit costs. eq
    11·1 answer
  • E13-5. (adjusting entry for sales tax) (lo 1) during the month of june, rowling boutique had cash sales of $233,200 and credit s
    5·1 answer
  • How can you get a mouse to function properly?
    10·1 answer
  • Answer the following questions on the basis of the following three sets of data for the country of North Vaudeville: (A) (B) (C)
    7·1 answer
  • You are US company, 500,000 BP (British Pound) payable to UK in one year. Answer in terms of US$. Information for Forward Contra
    15·1 answer
  • :How is a ‘provision for reserve’ in a balance sheet, a liability or an asset. Explain.
    10·1 answer
  • How can you fix the current finance decisions so that we are in a healthy cash position at the end of the year?
    5·2 answers
  • a company is already public with several major stockholders. the company proposes an offering where sale proceeds for shares bei
    11·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!