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olganol [36]
3 years ago
13

Rosalie owns 50% of the outstanding stock of Salmon Corporation. In a qualifying stock redemption, Salmon distributes $80,000 to

Rosalie in exchange for one-half of her shares, which have a basis of $100,000.
Compute Rosalie’s recognized loss, if any, on the redemption.
Business
1 answer:
lesya692 [45]3 years ago
4 0

Answer:

Rosalie’s recognized loss is $20,000.

Explanation:

Calculate the person R’s recognized loss:

Person R's recognized loss = Amount distributed -Basis of share

= $80,000-$100,000

= $20,000

Therefore, person R’s recognized loss is $20,000.

Person R’s recognized loss is $20,000.

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