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Dominik [7]
3 years ago
9

Jocelyn contributes land with a basis of $60,000 and fair market value of $90,000 and inventory with a basis of $5,000 and fair

market value of $8,000 in exchange for 100% of Zion Corporation stock. The land is subject to a $15,000 mortgage.
If an amount is zero, enter "0".
The exchange is tax-free under § 351 because the release of a liability not treated as boot under § 357(a). As a result, Jocelyn has income of $0 and a basis $ ____ in her stock.
Whats her basis?
Business
1 answer:
Natali5045456 [20]3 years ago
3 0

Answer: $50,000

Explanation:

Based on the scenario in the question, Jocelyn's basis in the property contributed will be:

Land = $60,000

Inventory = $5,000

Total = $65,000

We are told that the exchange is tax-free, hence, Jocelyn has income of $0.

Therefore, Jocelyn’s basis in Zion’s Corporation stock will be her original basis in property contributed which is $65,000 plus the gain of $0 and then we deduct the liability that was assumed by the corporation which $15,000. This will now be:

= $65,000 + 0 - $15,000

=$50,000

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4 0
3 years ago
Read 2 more answers
In an open economy, gross domestic product equals $1,970 billion, government expenditure equals $300 billion, investment equals
LenKa [72]
Answer: D

If you add 300 + 500 + 280 and then subtract the answer from 1,970 you will get your answer.
7 0
3 years ago
Which of the following best represents the stream of income that is available to common stockholders?
dmitriy555 [2]
Greeting's!

<span>c. earnings before interest and taxes .
______________________________
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7 0
3 years ago
5 An insured’s house is damaged by a fire and is uninhabitable. As a result, the insured has to rent an apartment until repairs
Nata [24]

Answer:

Coverage E - Additional Living Expense

Explanation:

Based on the scenario being described within the question it can be said that this individual has a Coverage E - Additional Living Expense. This is an insurance coverage that covers the home-owner with compensation when they they are not able to live in their house due to an loss or a claim which is insured. Such as damage due to fire, like in this scenario which made the house uninhabitable.

4 0
3 years ago
Consider a small country that is closed to trade, so its net exports are equal to zero. The following equations describe the eco
viva [34]

Answer:

Y = 300

government multiplier 2

output demanded increase by 20

If income tax is applied:

Y = 272.72

multipliers: 2.253775

increase 22.53775 billons

As disclosure it has a larget effect when the income tax is levied based on income rather than a flat rate.

Explanation:

DI = Y - 100

C = 30 + 0.6(Y - 100)

C = 30 - 60 + 0.6Y

C = 0.6Y - 30

Y = C + G + I

Y = (0.6Y -30) + 120 + 30

Y = 120 / 0.4 = 300

C = (0.6)300 - 30 = 150

With C we solve for the multiplier:

150/300 = 0.5

1 / (1 - 0.5) = 2

10 x 2 = 20

If variable that:

C = 30 + 0.6 (0.75Y)

C = 30 + 0.45Y

Y = 0.45Y + 120 + 30

Y = 150/.55 = 272,72

C = 30 + 0.45Y = 152,72

Propensitivity to consume:

152.72/272.72 = 0,5563

multiplier:

1 (1 - PMC) = 2.253775073

10 nillon will icnrease x 2.25377 = 22.54 billons

8 0
3 years ago
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