Ruby, Inc, Has 2,000 Shares of Stock Authorized and 1,000 Shares

question 8

Multiple Choice

Ruby, Inc., has 2,000 shares of stock authorized and 1,000 shares outstanding.The shares are owned by Sophia (850 shares) and Joan (150 shares) .Sophia's adjusted basis for her stock is $40,000 and Joan's adjusted basis for her stock is $35,000.Ruby's earnings and profits are $100,000.Ruby redeems 75 of Joan's shares for $50,000.Determine the amount of Joan's recognized gain (1) if she is Sophia's mother and (2) if they are unrelated.

• A)$0 and $0.
• B)$50,000 and $50,000.
• C)$50,000 and $-0-.
• D)$50,000 and $32,500.
• E)None of the above.

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Definitions:

CMO Level

Pertains to the executive position within a company responsible for the strategy, planning, execution, and oversight of marketing activities, typically known as the Chief Marketing Officer.

Senior-Level Executives

High-ranking officers within an organization responsible for making strategic decisions and overseeing operations.

Business Strategy

outlines a company's plan for achieving its goals, including positioning, market approach, and competitive advantages.

Annual Marketing Plan

A comprehensive document outlining a business's marketing strategies, objectives, and activities for the upcoming year.