Babex Inc. and OMG Company entered into an exchange of real property. Here is the information for the properties to be exchanged. BabexOMGFMV$1,000,000 $825,000 Adjusted tax basis 768,000 514,500 Mortgage 175,000 -0- Pursuant to the exchange, OMG assumed the mortgage on the Babex property. Compute OMG's gain recognized on the exchange and its tax basis in the property received from Babex.
A. No gain recognized; $514,500 basis in Babex property.
B. $175,000 gain recognized; $514,500 basis in Babex property.
C. No gain recognized; $689,500 basis in Babex property.
D. None of the choices are correct.
Answer: C
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Walton Corporation shows the following in the stockholders' equity section of its balance sheet: The stated value of its common stock is $0.50 and the total balance in the common stock account is $37,500 . Also noted is that 5,000 shares are currently designated as treasury stock. The number of shares outstanding is
a. 80,000. b. 75,000. c. 72,500. d. 70,000.
A new factory manager was hired for a company that was experiencing slow production rates and lower production volumes than demanded by management. Upon investigation, the manager found that the workers were poorly motivated and not closely supervised. Midway through the quarter, an incentive program was initiated, and cash bonuses were given when workers hit their production targets. Within a short time, production output increased, but the bonuses had to be charged to the direct labor budget. This could produce a(n) ________.
A) unfavorable direct materials cost variance B) unfavorable direct materials efficiency variance C) favorable direct labor efficiency variance D) favorable direct labor cost variance
On which of the following dates involving stock dividends does a liability arise?
A) Date of distribution B) Date of declaration C) Date of record D) On no date
________ assists an organization or its governing body in resolving ethical dilemmas based on the firm's mission, its culture, and its appetite and tolerance for risk.
What will be an ideal response?