uestion 6 10 points Save And balance in CE&P; of $7,000 Bob is the sole sharehol
ID: 2406972 • Letter: U
Question
uestion 6 10 points Save And balance in CE&P; of $7,000 Bob is the sole shareholder of Ludhe and has a $15000 Before considering the following distribution (date of distribution, February 6) Ludite, Inc. has a deficit in AESP of ($25,000) and a stock basis. Durin g the current year, Ludite distributed $50,000 to Bob as a non-liquidatin g distribution. Answer each of the following questions relating to this distribution A $35,000 B. $15,000 C.$7,000 D.$43,000 E$28,000 F. None of the answers is comect G. $50,000 How much dividend income does Bob report? How much capital gain does Bob report? tomicah hd at? What is Bob's stock basis when the duat clears after this distribution?Explanation / Answer
1) A) $7000. Bob reports dividend income = the balance in CE & P
2) E) $ 28000. calculation : 50000-7000 (dividend)- 15000 (stock basis) = 28000
3)A . $ 35000 calculation 50000-15000 (stock basis) = 35000
4) H $ 0. Since after deducting dividend $ 43000 is greater than his basis $ 15000
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