Q Corporation Had Assets with a Basis of $800,000 and No

question 22

Multiple Choice

Q Corporation had assets with a basis of $800,000 and no liabilities.P Corporation bought all the stock of Q Corporation for $1 million.Three years later, when Q Corporation's assets had shrunk to a basis of $600,000, P Corporation liquidated Q Corporation in a tax-free liquidation under § 332.What is P Corporation's basis in the assets received from Q Corporation? (Assume that P Corporation's basis in its assets not received from Q Corporation at the time of liquidation of Q was $750,000.)

• A)$400,000
• B)$800,000
• C)$1 million
• D)$600,000

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Definitions:

Updated Yearly

Describes something, typically a document or software, that is reviewed and revised on an annual basis to ensure it contains the most current information or features.

Petty Cash

A small amount of cash on hand used for covering minor expenses in a business, such as office supplies or coffee.

Account

A report or description of an event or experience, or the management and arrangement of financial expenditure and receipts.

Commission

A fee or percentage allowed to agents or salespeople for their services.