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Ch. 18 Property Distribution: Wade Corporation reported taxable income of $210,000 from operations this year....

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Accounting

  1. Ch. 18 Property Distribution: Wade Corporation reported taxable income of $210,000 from operations this year. The company paid federal income taxes of $52,500 for the year. During the year, the company made a distribution of a building to its sole shareholder. The buildings fair market value was $200,000 and its tax and E&P basis to Wade was $120,000. Rocky assumed a mortgage attached to the land of $63,000. The company had accumulated E&P of $540,000 at the beginning of the year.
  2. Compute Wades current E&P.
  3. Compute Wades accumulated E&P at the beginning of next year.
  4. What amount of dividend income does the shareholder report as a result of the distribution?
  5. What is the shareholders income tax basis in the building received from Wade?

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