ACC 4302 Exam 2 Fall 2020 Answers 1 (Revised 2023) 100% Correct Answers. MC 1. Ula purchased stock in Purple, Inc., 6 years ago for $150,000. Purple has assets with a value of $225,000 ($175,000 basis) and liabilities of $60,000. Purple transfers $200,000 of assets and all of its liabilities to White Corporation in exchange for White common stock. Purple distributes the White stock and its $25,000 remaining asset (cash) to Ula in exchange for all of her Purple stock. Purple then liquidates....

ACC 4302 Exam 2 Questions and Answers With Rationale 2022/2023. T/F 1. In general, if a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code will treat the transaction as a sale or exchange. a. True b. False ANSWER: False RATIONALE: If a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code generally will treat the transaction as a dividend distribution. 2. A shareholder’s basis in property acquired...

ACC 4302 Exam 2 Questions and Answers With Rationale 2022/2023. T/F 1. In general, if a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code will treat the transaction as a sale or exchange. a. True b. False ANSWER: False RATIONALE: If a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code generally will treat the transaction as a dividend distribution. 2. A shareholder’s basis in property acquired...

ACC 4302 Exam 2 Fall 2020 Answers 1 (Revised 2023) 100% Correct Answers. MC 1. Ula purchased stock in Purple, Inc., 6 years ago for $150,000. Purple has assets with a value of $225,000 ($175,000 basis) and liabilities of $60,000. Purple transfers $200,000 of assets and all of its liabilities to White Corporation in exchange for White common stock. Purple distributes the White stock and its $25,000 remaining asset (cash) to Ula in exchange for all of her Purple stock. Purple then liquidates....

ACC 4302 Exam 2 Questions & Answers Fall 2022 T/F 1. In general, if a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code will treat the transaction as a sale or exchange. a. True b. False ANSWER: False RATIONALE: If a shareholder’s ownership interest is not diminished as a result of a stock redemption, the Code generally will treat the transaction as a dividend distribution. 2. A shareholder’s basis in property acquired in a stock rede...

True/False/Multiple Choice (10 Points) 1. The primary purpose of the partnership agreement is to document the various tax elections made by the partners regarding depreciation methods, treatment of research and experimental costs, calculation of the § 199 deduction, and the § 754 election. __False______ 2. In a liquidating distribution, a partnership must distribute all of its property to all of its partners. ____False____ 3. On January 1 of the current year, Anna and Jason form an ...

MC 1. Ula purchased stock in Purple, Inc., 6 years ago for $150,000. Purple has assets with a value of $225,000 ($175,000 basis) and liabilities of $60,000. Purple transfers $200,000 of assets and all of its liabilities to White Corporation in exchange for White common stock. Purple distributes the White stock and its $25,000 remaining asset (cash) to Ula in exchange for all of her Purple stock. Purple then liquidates. How is this transaction treated for tax purposes? a. Ula recognizes a $...