In a Sec. 332 liquidation, what bases do both the parent and minority shareholders take in the assets received?
What will be an ideal response?
Because no gain/loss is recognized by the parent corporation, the parent corporation takes a carryover basis in its assets. However, since the minority shareholders are involved in a taxable exchange, the minority shareholders take an FMV basis in their assets.
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The term "preferred" comes from the fact that preferred shareholders receive all past (if cumulative) and present dividends before common shareholders can receive any cash dividends—in other words,
their dividend claims are preferred over common stock dividend claims. Indicate whether the statement is true or false.
A modification of a preexisting contract occurs when the parties agree to change one or more of its terms and, under the common law, must be supported by mutual consideration to be enforceable
Indicate whether the statement is true or false
David's liquidity ratio is 3.0. He has $1,000 in current liabilities. Therefore, he has ________ worth of liquid assets
A) $3,000 B) $333 C) $4,000 D) $700
When does a corporation record an increase in Dividends Payable?
A. On the date of record. B. On the declaration date. C. On the date of issuance. D. On the date of payment.