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
frez [133]
3 years ago
13

XYZ Corporation (an S corporation) is owned by Jane and Rebecca who are each 50% shareholders. At the beginning of the year, Jan

e's basis in her XYZ stock was $40,000. XYZ reported the following tax information for 2016.
Description Sales revenue Cost of goods sold Long-term capital gain Dividend income Tax exempt interest Salary to owners Employee wages Description expenses Miscellaneous expenses Overall net income
Amount $730,000 (200,000) 8,000 5,000 3,000 (120,000) (50,000) (12,000) (10,000) $354,000
Required
a. What amount of ordinary business income is allocated to Jane?
b. What is the amount and character of separately stated items allocated to Jane?
c. What is Jane's basis in her XYZ corp. stock at the end of the year?
Business
1 answer:
jasenka [17]3 years ago
4 0

Answer:

(a) $169,000 (b)The separated items are $8,000, $5000 and $3000 with the amount  of $4,000, $2,500 and $1,500 respectively. (c) $217,000

Explanation:

Solution

(a) The ordinary business  income allocated to Jane is given below:

Particulars                              Amount               Jane allocation 50%

Overall net income for 2016  $354,000

Less:

Long term capital gains           $8,000

Dividends                                 $5,000

Tax exempt interest                 $3,000

Ordinary business income      $338,000                   $169,000

Therefore ordinary business income allocated to Jane = $169,000  

(b) The amount and character of separately stated items allocated to Jane is given below:

Particulars                              Amount               Jane allocation 50%

Separately stated items :

Long term capital gains         $8,000                       $4,000

Dividends                                $5,000                       $2,500

Tax exempt interest               $3,000                       $1,500

(c) Jane’s stock basis at the end of the year is given below:

Jane’s stock basis at the end of the year = k + allocation(50%) +long term capital gains(50%)+dividends(50%)+tax exempt interest (50%))

= ($40,000+$169,000+$4,000+$2,500+$1,500)

= $217,000

Hence stock basis at the year end is $217,000

You might be interested in
A sudden stop will be easier to navigate if the country borrows internationally in foreign currencies and lend locally in its do
natulia [17]

Answer: False

Explanation:

A sudden stop refers to the sudden decline in net capital inflows in the economy from outside. This is a significant method by which the economy can have access to foreign exchange.

If the country therefore borrows internationally in foreign currencies whilst lending in domestic currency, the sudden stop will be difficult to navigate because it will impair the country's ability to pay off the international creditors it has because it will not have enough of the required foreign currency to pay them.

8 0
2 years ago
The XYZ Corporation has a distinct division of labor, consistent rules, and a clear hierarchy. Managers maintain distance betwee
Mamont248 [21]

Answer:

A bureaucracy

Explanation:

Bureaucracy is an organisational structure that is aimed at maintaining uniformity and control in an organisation.

This is achieved through established processes and ways of interaction between staff.

Bureaucracy is characterised by multiple layers and complex processes that makes actions and decisions slow.

This is exemplified in the given scenario where XYZ Corporation has a distinct division of labor, consistent rules, and a clear hierarchy. Managers maintain distance between themselves and subordinates, and promotions are awarded based on technical expertise.

3 0
3 years ago
What might be a consideration in deciding where to buy something?
ch4aika [34]
All of the above sounds about right
7 0
3 years ago
Read 2 more answers
A company's ____________ is the percentage of the total target market for the product that belongs to the company.
ikadub [295]

Answer:

B. market share

Explanation:

Market share is the percentage of consumers that a company has captured from its specific, desired market within an industry.

8 0
3 years ago
Read 2 more answers
Dividends in arrears are dividends on A. cumulative preferred stock that have been declared but have not been paid. B. non-cumul
Romashka [77]

Answer:

The correct answer is letter "A": cumulative preferred stock that have been declared but have not been paid.

Explanation:

Dividends in arrears are dividends that have not been paid in a period on cumulative preferred stock. A company does not necessarily have to pay dividends to its shareholders but the payment becomes cumulative. Under this situation, it is said that the organization has failed to generate enough cash during the year. Besides, there must be a dividend declaration for the dividends in arrears to be liable recognized.

7 0
3 years ago
Other questions:
  • Ricardo's sales manager just informed his sales team that all sales in January will earn an extra 5 percent commission. The team
    15·1 answer
  • What is gross profit? (Select the best answer.)
    10·1 answer
  • A ___________ makes databases more useful for obtaining information.
    11·1 answer
  • If the government sets out to make home buying easier for more people by forcing lenders to accept ____________ down payments an
    10·1 answer
  • Forest City has recently implemented GAAP reporting and is attempting to determine which of the following special revenue funds
    9·1 answer
  • Which of the following data analysis models use optimization techniques? Group of answer choices Prescriptive analytics Predicti
    11·1 answer
  • Suppose you put half of your money in Monster Beverage and half in IBM. What would the beta of this combination be if Monster Be
    9·1 answer
  • (Scenario: Assets and Liabilities of the Banking System) According to the Scenario: Assets and Liabilities of the Banking System
    7·1 answer
  • if keynesian economists were analyzing the oncoming recession starting in 2007 from the housing market crash, what might they ha
    15·1 answer
  • a portfolio business that generates operating cash flows over and above internal requirements, thereby providing financial resou
    13·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!