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pogonyaev
3 years ago
14

Pursuant to a complete liquidation, Carrot Corporation distributes to its shareholders real estate held as an investment (basis

of $650,000, fair market value of $880,000).
a. Determine the gain or loss recognized by Carrot on the distribution if no liability is involved.
Business
1 answer:
Triss [41]3 years ago
7 0

Answer:

The correct answer is $230,000 gain.

Explanation:

According to the scenario, the computation of the given data are as follows:

Fair value = $880,000

Basis = $650,000

So, we can calculate the gain or loss  on the distribution by using following formula:

Gain or Loss = Fair value - Basis

By putting the value, we get

Gain or Loss = $880,000 - $650,000

= $230,000 ( Positive shows gain)

So, Gain = $230,000.

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Which of the following bonds are issued by the U.S. government? corporate bondsjunk bondssavings bondsmunicipal bonds
hoa [83]
I believe that the bonds issued by the U.S government are the saving bonds. Corporate bonds are bonds issued by corporations in order to raise money for business expansion. Junk bonds are types of bonds that are lower rated however, they are potentially higher-paying. Municipal bonds are bonds issued by a state or local government for the purpose of financing social amenities and infrastructure such as improvements of highways, state buildings, libraries, parks and schools.
8 0
4 years ago
Define agency costs, and describe agency costs of financial distress and agency benefits of leverage
Aleks04 [339]

Answer:

In accounting, agency costs are the costs of hiring an agent in order for him/her to act on behalf of a principal. In finance, agency costs are much broader since they imply costs that may appear due to conflicts of interests between the agent and the principal. E.g. a manager who seeks to accomplish short term goals in order to collect a bonus but hurts the long term objectives and goals of the stockholders.

Agency costs of financial distress refers to the costs associated with conflicts of interest that may result in a company being insolvent, specially in the long run. This type of costs are not necessarily related to operating costs, instead they result from management decisions and strategies, e.g. higher cost of capital or debt, or even excessive spending.

Agency benefits of leverage result from stockholders benefiting from the agent's decision to keep equity low, and if needed, obtain financing from debt sources.

5 0
4 years ago
Terry and Jim are both involved in operating illegal businesses. Terry operates a gambling business and Jim operates a drug-runn
Jet001 [13]

Answer:

(c)Terry should report profit from his business of $250,000

Explanation:

Before computing the actual solution, first, we have to compute the net income of both the parties

For Terry = Gross revenue - employees salaries - rent and utility expenses

               = $500,000 - $200,000 - $50,000

               = $250,000

For Jim = Gross revenue - cost of goods sold

             = $500,000 - $125,000

            = $375,000

The other item values would not relevant for deduction. Hence, ignored it

Therefore, option c is correct.

               

3 0
3 years ago
You deposit $12,000 today into an account that pays you 12% annual interest, compounded daily. How much do you have in 40 years
vazorg [7]

Answer:

$1,456,975.19

Explanation:

FV = P (1 + r / m)^nm

FV = Future value

P = Present value

R = interest rate

N = number of years

M = number of compounding per year

$12,000 ( 1 + 0.12/365)^14600 = $1,456,975.19

I hope my answer helps you

4 0
3 years ago
The project team is ordering a server after discovering that it was missed in the original scope discovery of the project. There
11Alexandr11 [23.1K]

Complete Question:

The project team is ordering a server after discovering that it was missed in the original scope discovery of the project. There is an urgency to have it delivered quickly to minimize schedule slippage, but the project team does not want to spend money from dwindling reserves to pay for the additional shipping charges. Which of the following is the most accurate description of this situation?

A. There is an attribute issue since fast shipping and low cost shipping are both characteristics associated with shipping.

B. There is a budget issue since there isn't extra money for shipping.

C. There is a mutual exclusivity issue since shipping fast and low cost do not correlate to each other.

D. There is a time issue since the server needs to arrive quickly

Answer:

C. There is a mutual exclusivity issue since shipping fast and low cost do not correlate to each other

Explanation:

The most accurate description of this situation is that there is a mutual exclusivity issue since shipping fast and low cost do not correlate to each other. If two events are mutually exclusive, they cannot occur concurrently.

Mutually exclusivity describes the characteristics of events, which makes it impossible for them to occur together  (concurrently) or at the same time. This ultimately implies that the events or outcome of the sampling is disjointed.

In this scenario, there is an urgency to have the server delivered quickly (shipping fast) to minimize schedule slippage, but the project team does not want to spend money from dwindling reserves to pay for the additional shipping charges which is considered to be a high cost.

5 0
4 years ago
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