Jones Mills Incorporated (JMI) decided to liquidate its wholly owned subsidiary, Most Help, Incorporated (MH). MH had thefollowing tax accounting balance sheet: (Negative amount should be indicated by a minus sign. Leave no answer blank.Enter zero if applicable.)AdjustedТах Basis$ 237,80012,300Appreciation(Depreciation)FMV$ 237,80054,300183,500Cash42,000(59,500)$ (17,500)BuildingLand243,000$ 475,600$ 493,100Totala. What amount of gain or loss does MH recognize in the complete liquidation?Gain or loss recognized

Jones Mills Incorporated (JMI) decided to liquidate its wholly owned subsidiary, Most Help, Incorporated (MH). MH had the following tax accounting balance sheet: (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Adjusted Tax Basis $ 237,800 12,300 243,000 Appreciation (Depreciation) FMV $ 237,800 54,300 Cash Building 42,000 (59,500) $ (17,500) Land 183,500 $ 475,600 $ 493,100 Total a. What amount of gain or loss does MH recognize in the complete liquidation? Gain or loss recognized

Jones Mills Incorporated (JMI) decided to liquidate its wholly owned subsidiary, Most Help, Incorporated (MH). MH had the following tax accounting balance sheet: (Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable.) Adjusted Tax Basis $ 237,800 12,300 243,000 Appreciation (Depreciation) FMV $ 237,800 54,300 Cash Building 42,000 (59,500) $ (17,500) Land 183,500 $ 475,600 $ 493,100 Total a. What amount of gain or loss does MH recognize in the complete liquidation? Gain or loss recognized

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter6: Corporations: Redemptions And Liquidations

Section: Chapter Questions

Problem 65P

See similar textbooks

Similar questions

ABC Corp calculated that it had sustained a deferred tax asset of $450,000 in respect of a tax loss and deductible temporary difference of $2.25 million but it had not recognised any such asset in the balance sheet. During the year, a business was injected to the company by themajor shareholder and the company began to derive taxable profit to offset with the loss brought forward. Required:1. Discuss the implication of the current development on ABC’s deferred tax asset.2. Suggest journal entries to effect the implication in (1).3. If the tax rate is increased to 30%, discuss and suggest journal entries.
ABC Corp calculated that it had sustained a deferred tax asset of $450,000 in respect of a tax loss and deductible temporary difference of $2.25 million but it had not recognized any such asset in the balance sheet. During the year, a business was injected to the company by the major shareholder and the company began to derive taxable profit to offset with the loss brought forward. Required: Discuss the implication of the current development on ABC’s deferred tax asset. Suggest journal entries to effect the implication in (1). If the tax rate is increased to 30%, discuss and suggest journal entries.
X Corporation opted to deduct OSD. The following are the results of its operation: Net sales -P3,450,000; Cost of Sales – P2,100,000; Dividend from Y Corporation, a domestic corporation – P150,000; Gain on sale of Building – P200,000; Selling Expenses – P70,000; Administrative Expenses – P30,000. What is the taxable net income? P 930,000 P 1,020,000 P 870,000 P 810,000
X Corporation opted to deduct OSD. The following are the results of its operation: Net sales -P3,450,000; Cost of Sales – P2,100,000; Dividend from Y Corporation, a domestic corporation – P150,000; Gain on sale of Building – P200,000; Selling Expenses – P70,000; Administrative Expenses – P30,000. What is the taxable net income? A. P 930,000 B. P 1,020,000 C. P 870,000 D. P 810,000
A subsidiary that has a net operating loss carryforward is acquired. The related deferred income tax asset is $230,000. Because the parent believes that a portion of this carryforward likely will never be used, it also recognizes a valuation allowance of $150,000. At the end of the first year of ownership, the parent reassesses the situation and determines that the valuation allowance should be reduced to $110,000. What effect does this change have on the business combination’s reporting?
Lanzones Corp. began operations at the beginning of the current year. At the end of the first year of operations, the entity reported P6,000,000 income before income tax in the income statement but only P5,100,000 taxable income in the tax return. Analysis of the P900,000 difference revealed that P500,000 was a permanent difference and P400,000 was a temporary tax liability difference related to a current asset. The tax rate for the current year and future years is 30%. Required: 1. What is the accounting or financial income subject to tax?2. The total income tax expense for the current year is?3. How much is the pretax financial income?
Assuming X and Y Corporation entered into a merger resulting to Y corporation being dissolved. X had inventories of goods amounting to P1,000,000.00 and Y had P600,000.00. Assume that there is available input tax unused by X and Y. Requirement: How will the inventories be treated in relation to business taxation?
Assume that Puritan Corp. operates in an industry for which NOL carryback is allowed. Puritan Corp. reported the following pretax accounting income and taxable income for its first three years of operations: 2020 $ 353,000 2021 (596,000 ) 2022 708,000 Puritan's tax rate is 37% for all years. Puritan elected a loss carryback.As of December 31, 2021. Puritan was certain that it would recover the full tax benefit of the NOL that remained after the operating loss carryback. What did Puritan report on December 31, 2021, as the deferred tax asset for the NOL carryforward?
Asempa Ltd disposed of its entire holding in Daakye Ltd on 30the September 2013 for GH¢ 12 million, on which date the net assets of Daakye Ltd was GH¢9.6 million. It is the policy of measuring NCI at acquisition at proportionate of the fair value of identifiable net asset and no goodwill is impaired as at 30th September 2013. Tax is charged at 25%. Required Calculate the profit or loss on disposal for: (i) Asempa Ltd’s individual financial statements (ii) Consolidated financial statements
Jin Company’s income tax return showed taxable income of P4,000,000 on which a tax liability of P1,200,000 has been recognized. Additional information are as follows: * Accelerated depreciation for income tax purposes was P500,000. Straight-line financial depreciation on the assets is P400,000. * Goodwill impairment loss of P300,000 was not included as a deduction in the tax return but may be deducted in the income statement. * Interest income on treasury bills was not included in the tax return.During the year, P600,000 was received on these investments. What is the pretax financial income of Jin? a. P4,100,000 b. P4,200,000 c. P4,300,000 d. P4,400,000
In its first year, Firm KZ recognized $427,300 ordinary business income and a $13,590 loss on the sale of an investment asset. In its second year, Firm KZ recognized $500,800 ordinary business income, a $19,300 Section 1231 gain, and a $7,400 Section 1231 loss on two sales of operating assets. * I only need Requirement D to be solved. Required: d. Compute KZ's deferred tax asset or liability (identify which) on its balance sheet on the last day of the second year.
Consider the following worksheet with information extracted from a financial statement:2018 Assets Liabilities EquityReported (P) 500 000 100 000 400 000An analyst makes an adjustment that decreases goodwill by P100 000 and equity (profit) by P100 000. This goodwill was acquired on consolidation, hence there are no tax adjustments. Using the worksheet approach, what would be the change in the debt to assets ratio?