Alomar, a Cash Basis S Corporation in Orlando, Florida, Holds

question 31

Essay

Alomar, a cash basis S corporation in Orlando, Florida, holds the following assets and liabilities on January 1, 2016, the date the S election is made. $$\begin{array} { l r r } & \text { Adjusted Basis } & \text { Fair Market Value } \\\text { Cash } & \$ 200,000 & \$ 200,000 \\\text { Accounts receivable } & - 0 - & 105,000 \\\text { Equipment } & 110,000 & 100,000 \\\text { Land } & 1,800,000 & 2,500,000 \\\text { Accounts payable } & - 0 - & 110,000\end{array}$$ ​
During the year, Alomar collects the accounts receivable and pays the accounts payable.The land is sold for $3 million, and the taxable income for the year is $590,000.Calculate any built-in gains tax.

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Definitions:

Behavioral Expressions

The ways in which behaviors are outwardly shown and can be observed in the context of emotions, thoughts, and social interactions.

Conscious Feelings

Emotional experiences that are within one's immediate awareness.

Sympathetic Nervous system

A part of the autonomic nervous system that activates the body's responses under stress, such as increasing heart rate and redirecting blood flow.

Parasympathetic Nervous System

A component of the autonomic nervous system responsible for energy conservation by decreasing the heart rate, enhancing the activity of intestines and glands, and easing the muscles of sphincters in the digestive system.