A Corporation Distributes Land and the Related Liability to Meg

question 20

Multiple Choice

A corporation distributes land and the related liability to Meg, its sole shareholder. The land has an FMV of $60,000 and is subject to a liability of $70,000. The corporation has current and accumulated E&P of $80,000. The corporation's adjusted basis for the property is $70,000. What effect does the transaction have on the corporation?

• A)A recognized loss of $10,000; its E&P is reduced by $70,000.
• B)A recognized loss of $10,000; its E&P is unchanged.
• C)No recognized gain or loss; its E&P is reduced by $60,000.
• D)No recognized gain or loss; its E&P is unchanged by the distribution.

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Definitions:

Organisational Objectives

are the specific, measurable goals that an organization aims to achieve in order to fulfill its mission and strategic vision.

Leader Adjusting Tasks

The process where a leader adapts and reallocates tasks among team members to optimize performance, address challenges, or leverage individual strengths.

Moral Leadership

Moral leadership is always ‘good’ and ‘right’ by ethical standards.

Ethical Behaviour

Accepted as ‘right’ or ‘good’ or ‘proper’ in the context of a governing moral code.