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faust18 [17]
3 years ago
15

Sybil transfers property with a tax basis of $5,000 and a fair market value of $6,000 to a corporation in exchange for stock wit

h a fair market value of $3,000 and $2,000 cash in a transaction that qualifies as a section 351 transfer. The corporation assumed a liability of $1,000 on the property transferred. What is Sybil's tax basis in the stock received in the exchange?
A) $6,000.
B) $5,000.
C) $4,000.
D) $3,000.
Business
1 answer:
SCORPION-xisa [38]3 years ago
4 0

Answer:

D) $3,000

Explanation:

Calculation to calculate determine Sybil's tax basis in the stock received in the exchange

Tax basis $5,000

Add recognized gain $1,000

($6,000-$5,000)

Less boot received ($2,000)

Less liability ($1,000)

Sybil's tax basis $3,000

Therefore Sybil's tax basis in the stock received in the exchange will be $3,000

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Overview of financial planning
VMariaS [17]

Answer:

1. Operating plan.

2. Operating plan.

3. Financial plan.

4. Dividend policy.

5. B and C.

Explanation:

1. Operating plan: provides detailed implementation guidance for a firm's operations, as well as a forecast of the company's expected future free cash flows.

2. Operating plan: provides the inputs necessary for a risk management evaluation using sensitivity analysis, scenario analysis, or simulations.

3. Financial plan: Is based on knowledge of the amount of funds necessary to compensate the firm's shareholders, and the mix of debt and equity capital used to finance the firm.

4. Dividend policy: sets forth specific targets for cash or share distributions to the firm's shareholders.

Capital structure: describes specific targets for the mix of debt and equity used to finance a firm.

Financial planning can be defined as the process of estimating the amount of capital required for the smooth operations of the business and determine how to achieve the firm's set goals and objectives.

Hence, the following statements are true about financial planning;

I. Once a firm's forecasted financial statements are prepared, the firm must determine how much capital it will need to support these plans.

II. Management must monitor operations after implementing a financial plan to detect deviations from the plan and adjust accordingly.

6 0
3 years ago
The process of joint decision making in which employees share a high degree of decision-making power with their superiors is cal
iVinArrow [24]

Answer:

The process of joint decision making in which employees share a high degree of decision-making power with their superiors is called Participative Management

5 0
3 years ago
Disinflation can be explained by the phillips curve analysis as resulting from a situation where the actual rate of inflation is
lakkis [162]

According to the Phillips curve analysis, disinflation happens when the actual rate of inflation is initially lower than the expected rate, temporarily raising the unemployment rate. However, as nominal wages decline, the unemployment rate will fall to its natural level and the actual and expected rates of inflation will balance out.

Disinflation refers to occurrences where the inflation rate has temporarily slowed and is used to indicate situations where it has only slightly decreased. Disinflation refers to the rate of change in the rate of inflation, as opposed to inflation and deflation, which talk about the direction of prices.

To learn more about Disinflation here

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5 0
1 year ago
Can you breifly explain why stockholders' investment and revenues increase stockholders' equity, while dividends and expenses de
Scilla [17]
From an accounting standpoint, stockholders' investment and revenues increase the assets of the company without adding to the liabilities. Therefore according to the equation (A = L + E), equity must increase.

Similarly, issuing dividends and paying expenses pays cash out of the company, which decreases assets without changing liabilities. Therefore equity must decrease.

Another way to think of it is: what contributes to the company's profit and/or value, and what decreases these things? Well, revenues and people investing in the company are good (and therefore good for stockholders), and giving cash out and paying expenses are costs to the company (and therefore decrease value for stockholders).
5 0
3 years ago
Zino Company determines that a customer balance of $200,from Hollis Co. is uncollectible. Zino uses the allowance method to acco
Natalka [10]

Answer:

The correct answer is A

Explanation:

The journal entry to be posted to write off the balance of uncollectible is as:

Allowance for Doubtful Accounts A/c..........................Dr   $200

              Accounts Receivable A/c.......................................Cr  $200

As the allowance method is used so the accounts receivable account will be credited and the allowance for doubtful accounts is debited with the amount which is recovered that is $200.

Allowance method is generally refer to one of the ways for reporting the uncollectible or bad debt expense which results from a company selling the goods on credit.

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3 years ago
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