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Anvisha [2.4K]
3 years ago
13

Ben and Jerry were shareholders of Water Ice Inc., an S corp. On Jan. 1, 1998, Ben owned 40 shares and Jerry owned 60 shares. Be

n sold his shares to Joe for $10,000 on March 31, 1998. The corp. reported a $50,000 loss at the end of 1998.
How much of the loss is allocated to Joe?
A. $20,000
B. $15,060
C. $12,500
D. $10,000
Business
1 answer:
expeople1 [14]3 years ago
7 0

Answer: $15,060

Explanation:

From the question, we are informed that Ben and Jerry were shareholders of Water Ice Inc., an S corp. On Jan. 1, 1998, Ben owned 40 shares and Jerry owned 60 shares.

We are further told that Ben sold his shares to Joe for $10,000 on March 31, 1998 and that the corp. reported a $50,000 loss at the end of 1998. The loss that will be allocated to Joe will be:

= $50,000 × 40% × 9/12

= $50,000 × 0.4 × 0.75

= $15,000

The closest figure we have close to that is $15,060 which is option B

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1 year ago
Consider a perfectly competitive market in which all firms have the same costs. Choose the statement that is incorrect.
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B. The market demand is perfectly elastic at the market price. °

Explanation:

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Why are some economists concerned about the proliferation of regional trade agreements? regional trade agreements terms can conf
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The government tax for a sole proprietorships and a partnership is classified under
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In its statement of cash flows issued for the year ending September 30, Berne Company reported a net cash inflow from operating
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Answer:

B. $29,000

Explanation:

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