Weaver Corporation Has Net Assets Valued at $800,000 and an NOL

question 15

Multiple Choice

Weaver Corporation has net assets valued at $800,000 and an NOL of $250,000. On September 30 of the current year, Weaver is acquired by Loom Corporation, a calendar year taxpayer, in a restructuring qualifying as a tax-free reorganization. Weaver shareholders receive 30% of Loom's shares in exchange for all of their Weaver stock. Assuming that the Federal long-term tax-exempt rate is 3%, what is the maximum amount of Weaver's NOL available to Loom in the current year?

• A) $250,000
• B) $62,500
• C) $24,000
• D) $7,500
• E) None of these

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