Gamma Corporation has E&P of $7,000 and 1,000 shares of stock outstanding before the following transaction. Gamm shares of stock in a transaction that qualifies for sale treatment as a redemption. In exchange for the stock, the corpora shareholder land with a FMV of $10,200 and a basis to the corporation of $4,000. What is the corporation's ending E& transaction? OA$1,428 OB. Zero OC $3,000 OD $10,470
Gamma Corporation has E&P of $7,000 and 1,000 shares of stock outstanding before the following transaction. Gamm shares of stock in a transaction that qualifies for sale treatment as a redemption. In exchange for the stock, the corpora shareholder land with a FMV of $10,200 and a basis to the corporation of $4,000. What is the corporation's ending E& transaction? OA$1,428 OB. Zero OC $3,000 OD $10,470
Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations
Section: Chapter Questions
Problem 15CE
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Transcribed Image Text:Gamma Corporation has E&P of $7,000 and 1,000 shares of stock outstanding before the following transaction. Gamma redeems 120
shares of stock in a transaction that qualifies for sale treatment as a redemption. In exchange for the stock, the corporation transfers to the
shareholder land with a FMV of $10,200 and a basis to the corporation of $4,000. What is the corporation's ending E&P after this redemption
transaction?
OA $1,428
OB. Zero
OC $3,000
OD.$10,470
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