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dlinn [17]
3 years ago
9

Larry, the sole shareholder of Brown Corporation, sold his Brown stock to Ed on July 30 for $270,000. Larry's basis in the stock

was $200,000 at the beginning of the year. rown had accumulated E & P of $120,000 on January 1 and has current E & P of $240,000. During the year, Brown made the following distributions: $450,000 of cash to Larry on July 1 and $150,000 of cash to Ed on December 30.How much of the current E & P is allocated to Larry's distribution?
Business
1 answer:
Mrac [35]3 years ago
3 0

Answer:

$180,000

Explanation:

Given that

Current E & P = $240,000

Distribution to Larry = $450,000

The computation of current E & P is allocated to Larry's distribution is shown below:-

Current E & P is allocated to Larry's distribution = (Current E & P × Distribution to Larry) ÷ Total distribution

= ($240,000 × $450,000) ÷ $600,000

= $108,000,000  ÷ $600,000

= $180,000

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Arvo Corporation is trying to choose between three alternative investments. The three securities that the company is considering
oee [108]

Answer:

9.635%

Explanation:

We shall use a table to compute different values as shown below.

<u>Investment</u>       <u>Return</u>     <u>Taxable amount</u>    <u>Tax Rate</u>       <u>After-tax return</u>

Dividend              9.8%             30% (n1)              18%             9.2708% (w1)

Municipal bond   8.8%              0%                      18%             8.8%

Corporate bond   11.75%          100%                   18%             9.635% (w2)

The after tax return with on the best investment alternative is 9.635% for corporate bonds

<u>Workings</u>:

W1

9.8 *0.3*0.18 = 0.5292%

Return after tax = 9.8% -0.5292% = 9.2708%

w2

18.75*0.18 =2.115%

Return after tax = 11.75% -2.115% = 9.635%

<u>Notes:</u>

n1 : 70% of the dividends are excluded from taxation. Only 30% is to be taxed

4 0
3 years ago
n investment project has annual cash inflows of $4,000, $4,900, $6,100, and $5,300, for the next four years, respectively. The d
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Answer:

the answer is 11,000

Explanation:

4 0
2 years ago
How do the elements of the marketing mix work together to help create a<br>marketing strategy?​
alex41 [277]

Answer:

The marketing mix refers to the actions a company takes to market its product(s) and/or service(s). Typically, it acts as a framework for breaking down the four key components of marketing — product, price, place, and promotion.

Explanation:

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Answer:

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