Cowboy Corporation Owns 90% of the Single Class of Stock $\begin{array}{|l|l|}\hline \text { Doggie } & \text { Cowboy } \\\hline\$ 0 & \$ 0\\\hline\end{array}$

question 73

Multiple Choice

Cowboy Corporation owns 90% of the single class of stock in Doggie Corporation. The other 10% is owned by Miguel, an individual. Cowboy's basis in its Doggie Corporation stock is $100,000 and Miguel's basis is $50,000. Doggie Corporation distributes property having an adjusted basis of $150,000 and an FMV of $500,000 to Cowboy Corporation, and $60,000 of money to Miguel as a liquidating distribution. Doggie and Cowboy Corporations must recognize gain of:

• A) \(\begin{array}{|l|l|}\hline
• \text { Doggie } & \text { Cowboy } \\
• \hline\$ 0 & \$ 0\\\hline
• \end{array}\)
• B) \(\begin{array}{|l|l|}
• \hline\text { Doggie } & \text { Cowboy } \\
• \hline\$ 10,000 & \$ 0 \\
• \hline
• \end{array}\)
• C) \(\begin{array}{|l|l|}
• \hline\text { Doggie } & \text { Cowboy } \\
• \hline\$ 400,00 & \$ 350,000 \\
• \hline
• \end{array}\)
• D) \(\begin{array}{|l|l|}
• \hline\text { Doggie } & \text { Cowboy } \\
• \hline\$ 350,000 & \$ 400,000 \\
• \hline
• \end{array}\)

---

Definitions:

Predictive Validity

Refers to the extent to which a score on a scale or test predicts future performance on some outcome.

Factor Analysis

A statistical technique used to identify underlying variables, or factors, that explain the pattern of correlations within a set of observed variables.

Down Syndrome

A genetic disorder caused by the presence of an extra chromosome 21, characterized by developmental and intellectual delays.

Savant Syndrome

A rare condition where someone with significant mental disabilities demonstrates profound and prodigious capacities or abilities in specific areas.