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Masteriza [31]
3 years ago
13

Clampett, Incorporated, converted to an S corporation on January 1, 2020. At that time, Clampett, Incorporated, had cash ($40,00

0), inventory (FMV $60,000, basis $30,000), accounts receivable (FMV $40,000, basis $40,000), and equipment (FMV $60,000, basis $80,000). In 2021, Clampett, Incorporated, sells its entire inventory for $60,000 (basis $30,000). Assume the corporate tax rate is 21 percent. Clampett, Incorporated's taxable income in 2021 would have been $1,000,000 if it had been a C corporation. How much built-in gains tax does Clampett, Incorporated, pay in 2021
Business
1 answer:
lana [24]3 years ago
3 0

Answer:

$2,100

Explanation:

Particulars                     Fair market value      Basis        Differences

Inventory                             $60,000              $30,000       $30,000

Account receivables           $40,000              $40,000       $0

Equipment                           $60,000              $80,000      <u> ($20,000)</u>

Taxable gain                                                                           $10,000

Tax rate                                                                                   <u>   21%    </u>

Built in gains tax                                                                     <u>$2,100  </u>

So therefore, the built-in-gains tax that Clampett (Incorporated) will pay in 2021 is $2,100.

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Explanation:

The income statement has been uploaded for your benefit.

The schedules attached tagged "workings" explains how we arrived at each change in cash flow by line item.

8 0
3 years ago
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<h3>What is meant by Consumer Credit?</h3>

Consumer credit refers to debt incurred by an individual to pay for products and services. An example of consumer credit is a credit card.

Consumer credit might refer to any sort of personal loan, although it is more frequently used to denote unsecured debt that is incurred to pay for regular products and services. Consumer debt can, however, also refer to secured loans like mortgages and auto loans.

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4 0
1 year ago
An employee is given a formal written warning for an offense he has committed. Despite this, he proceeds to commit another offen
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Answer:

temporary suspension and maybe an Improvement Plan.

Explanation:

Based on the scenario, if the company has adopted a progressive discipline program then the according response would be a temporary suspension and maybe an Improvement Plan. This is because a progressive discipline program follows the following steps accordingly.

1) Verbal Counseling. The first step in a progressive discipline process is to merely have a conversation with the employee. ...

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Seeing since step 2 has already been done the next course of action would be step 3.

6 0
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Macroeconomics is a branch of economics that studies the economy as a whole. Economic variables studied in macroenomics includes GDP, unemployment, inflation etc

Microeconomics is a branch of economics that studies the behaviour of economic agents- individuals and firms in the economy.

I hope my answer helps you

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