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Citrus2011 [14]
3 years ago
7

Ula purchased stock in Purple, Inc., six years ago for $150,000. Purple has assets with a value of $225,000 ($175,000 basis) and

liabilities of $60,000. Purple transfers $200,000 of assets and all its liabilities to White Corporation in exchange for White common stock. Purple distributes the White stock and its $25,000 remaining asset (cash) to Ula in exchange for all her Purple stock. Purple then liquidates. How is this transaction treated for tax purposes?
Business
1 answer:
elena55 [62]3 years ago
3 0

Answer:

$15,000 gain

Explanation:

Assets with a value of $225,000

Remaining asset (cash) to Ula ($25,000)

Purple liabilities ($60,000)

Balance $140,000

Balance Brought forward $140,000

Remaining asset (cash) to Ula $25,000

Ula purchased stock ($150,000)

Balance $15,000 gain

Or

$225,000-$25,000-$60,000=$140,000+$25,000-$150,000=$15,000 gain

Therefore we have $15,000 gain.

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3 years ago
Which of the following practices would indicate that an employer is trying to overcome a moral-hazard problem with his employees
dsp73

Answer:b) the employer pays his employees year end bonus according to how the business does and his observation of the employees efforts

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3 years ago
Beth, a recent college graduate, recognizes that she has lots of nice "stuff," largely thanks to her family buying it for her. B
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Answer:

D

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3 years ago
t the end of the year, the records of NCIS Corporation provided the following selected and incomplete data: Common stock ($10 pa
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Answer:

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= 155,000 - 5,000

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Par value is $10 and Stock was sold for $14

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Unexpected inflation causes the demand for money to and the interest rate to
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Inflation will cause interest rates to rise. When interest rates rise demand for money decreases.

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