(Solution) If You Want The Formulas And Any Calculations, Select The Corresponding Cell And Press F2(Function Key On Key Board), It Will Show All Calculations... | Snapessays.com

(Solution) If you want the formulas and any calculations, select the corresponding cell and press F2(Function Key on key board), It will show all calculations...

Good Morning,

Thanks,

BrianIf you want the formulas and any calculations, select the corresponding cell and press F2(Function Key on key board),

It will show all calculations and formulas Automatically

Question:

Tammy organized Sweet corporation in january of the current year and the coproation immedediatley

elected to be an S Corporation. Tammy who contributed 40,000 in cash to start the business owns 100

percent of the corporation's stock. Sweet's current years results are ordinary income \$36,000 and short

term capital loss of \$5,000. On July 10, Sweets makes a \$10,000 cash distribution to Tammy.

a. What income do Sweets and Tammy recognize if any as a result of the distibution

Solution: Computation of the income do Sweets and Tammy recognize

Tammy is 100% owner of Sweet Corporation (an S Corporation).

Particulars

Amount

Ordinary income

\$36,000

Net Income

\$36,000

Short term capital loss

\$5,000

b. What is Tammy's basis for the Sweets stock on December 31?

Solution; Computation of the Tammy's basis for the Sweets stock on December 31

Particulars

Amount

Cash contributed

\$40,000

\$36,000

Less: Cash distribution

\$(10,000)

Short term capital loss

\$(5,000)

\$61,000

Note:

Capital losses are not set off from ordinary income, the capital loss will be carried forward to next year.

Solution details:
STATUS
QUALITY
Approved

This question was answered on: May 23, 2022

Solution~00021147721549.zip (25.37 KB)

This attachment is locked

Our expert Writers have done this assignment before, you can reorder for a fresh, original and plagiarism-free copy and it will be redone much faster (Deadline assured. Flexible pricing. TurnItIn Report provided)

STATUS

QUALITY

Approved

May 23, 2022

EXPERT

Tutor