Brett Owns Stock in Oriole Corporation (Basis of $100,000) as an Investment

question 53

Multiple Choice

Brett owns stock in Oriole Corporation (basis of $100,000) as an investment. Oriole distributes property (fair market value of $375,000? basis of $187,500) to him during the year. Oriole has current E & P of $25,000 (which includes the E & P gain on the property distribution) , accumulated E & P of $100,000, and makes no other distributions during the year. What is Brett's capital gain on the distribution?

• A) $0
• B) $100,000
• C) $150,000
• D) $187,500
• E) None of the above

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Definitions:

Coffee

A beverage made from the roasted and ground seeds of a coffee plant, consumed globally for its stimulating effect.

Comparative Advantage

The concept that a country, individual, or company produces a good or service at a lower opportunity cost than their competitors.

Trade

The exchange of goods or services between parties, which could be within an economy or between economies.

Coffee

A brewed drink prepared from roasted coffee beans, which are the seeds of berries from the Coffea plant.