1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Mandarinka [93]
3 years ago
14

Three individuals form Skylark Corporation with the following contributions: Cliff, cash of $50,000 for 50 shares; Brad, land wo

rth $20,000 (basis of $11,000) for 20 shares; and Ron, cattle worth $9,000 (basis of $6,000) for 9 shares and services worth $21,000 for 21 shares.
A. Ron’s basis in his stock is $6,000
B. Brad’s basis in his stock is $20,000
C. Ron’s basis in his stock is $27,000
D. These transfers are fully taxable and not subject to § 351.
E. Ron has income on the transaction of $20,000.
Business
1 answer:
erastova [34]3 years ago
4 0

Answer:

C. Ron’s basis in his stock is $27,000

Explanation:

Income recognized on services rendered $21,000

Add basis of $6,000

Ron stock basis $27,000

The property contributed by Ron is not considered insignificant compared to the value of the services he has rendered, which is why the entire contribution is counted as being for property.

Hence, the control requirement is satisfied and a valid § 351 transaction results. Ron’s stock basis is $27,000 [$6,000 (basis of cattle transferred) + $21,000 (income recognized on services rendered)]

You might be interested in
ou open a business selling art supplies and lessons. In your first month, you had the following total sales: $4,000 in paint, $2
never [62]
8,400 is your answer all you have to do is add the 4 sales and subtract the discounts and the returns 
8 0
3 years ago
Read 2 more answers
The relationship between the future value of a single sum and the corresponding present value of a single sum is determined by t
Schach [20]

Answer:

D

Explanation:

interest rate per compounding period​ ; number of compounding periods

5 0
2 years ago
A company has a discount on a forward contract for an asset. How is the discount recognized over the life of the contract?
exis [7]

Answer: It is charged to accumulated other comprehensive income.

Explanation:

The discount is recognized over the life of the contract when it is charged to accumulate other comprehensive income.

5 0
3 years ago
Select three situations when an agency can perform a warrantless search.
Eddi Din [679]
C or d im npt sure about d if its a emergency you would at least have to have permission from the owner of the property
8 0
3 years ago
Assume Metro Company had a net income of​ $2,100 for the year ending December 2018. Its beginning and ending total assets were​
Sever21 [200]

Answer:

7.92%

Explanation:

The computation of the return on total assets is shown below:

Return on assets = (Net income) ÷ (average of total assets)

where,  

Net income is $2,100

Average total assets = (Beginning total assets + ending total assets) ÷ 2

= ($33,500 + $19,500) ÷ 2

= $26,500

Now put these values to the above formula  

So, the ratio would equal to

= $2,100 ÷ $26,500

= 7.92%

7 0
3 years ago
Other questions:
  • Which of the following correctly describes NIMS? A. A communications plan. B. A static system used during large-scale incidents.
    14·2 answers
  • Payback occurs when: a. the net cumulative benefits equal the net cumulative costs. b. the net costs are lower than the cumulati
    11·1 answer
  • A(n) _____________ is a spending plan that allows you to estimate how much money you will need for expenses during a specific pe
    13·1 answer
  • Cathrine Corporation acquired a machine for $26,000, and has recorded depreciation for 3 yearsusing the straight-line method ove
    5·1 answer
  • On January 1, 2018, Crane Corp. changed its inventory method to FIFO from LIFO for both financial and income tax reporting purpo
    5·1 answer
  • Dan, and Mike are brothers. They plan to begin savings plans when each is exactly 25. Each brother plans to save $6,000 per year
    13·1 answer
  • The accounting standards state that management is responsible to evaluate the​ entity's ability to continue as a going concern
    8·1 answer
  • Budgeted Actual Overhead cost $909,000 $884,000 Machine hours 55,000 46,000 Direct labor hours 101,000 98,000 Overhead is applie
    12·1 answer
  • Suppose the seventh carrot you consume provides a marginal utility of 3 utils and the eighth carrot provides a marginal utility
    5·1 answer
  • While stockholders elect the board of directors of a corporation, the board of hires the president, vice president and other off
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!