Logo
Home Study Material Contact Search
AI Chat FREE
  1. business
  2. accounting
  3. at the end of the year, before distributions, bomb

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated...

70.2K

Verified Solution

Question

Accounting

At the end of the year, before distributions, Bombay (an S corporation) has an accumulated adjustments account balance of $20,000 and accumulated E&P of $26,250 from a previous year as a C corporation. During the year, Nicolette (a 40 percent shareholder) received a $26,250 distribution (the remaining shareholders received $39,375 in distributions). (Assume her stock basis is $52,500 after considering her share of Bombays income for the year but before considering the effects of the distribution.)

Required:

  1. What are the amount and character of income or gain Nicolette must recognize from the distribution?
  2. What is her basis in her Bombay stock at the end of the year?

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students

Q

A company has a beginning inventory of $ 20,000 and purchasesduring the year of...

Accounting
Q

Outline the evolution of the human lineage between 8 and 2 Mya.

Biology
Q

Auto Injury : A Case Study in Acid-Base Balance Mr. Wilson , a 60-year-old male, was...

Medical Sciences
Q

What are some of the issues or problems that arise because of GMO's? (Ethical, or environmental,).

Biology
Q

I need new and unique answers, please. (Use your own words, don't copy and paste), Please Use...

Medical Sciences
Q

Consider the following table of data that was generated from randomly surveying 100 people and recording...

Basic Math
Q

The point P(x, y) on the unit circle that corresponds to a real number t...

Basic Math
Q

Find the mean of the given probability distribution The accompanying table shows the probability distribution...

Statistics
Q

The use of a single indirect-cost rate is more likely to: ...

Accounting
Q

Adams Company reports the following balance sheet accounts as of December 31. Salaries payable...

Accounting
Q

Assume that total costs assigned to the setup activity cost pool in March are $120,000...

Accounting
Q

Suppose a U.S. investor wishes to invest in a British firm currently selling for 40...

Finance