Buddy Owns 100 of the Outstanding Shares of Binder Corporation

question 46

Multiple Choice

Buddy owns 100 of the outstanding shares of Binder Corporation stock. Buddy's basis in his Binder Corporation stock is $100,000. Binder Corporation is merged with Clipper Corporation in a tax-free reorganization. Buddy receives 50 shares of Clipper stock worth $150,000 and $150,000 cash. The remaining 100 shares of Binder stock were owned by Bruce who received the same consideration for his Binder stock. Binder and Clipper have E&P balances of $250,000 and $500,000, respectively. Buddy and Bruce each own 25% of Clipper Corporation's 200 shares of stock after the reorganization. Which of the following is correct?

• A)Buddy recognizes $200,000 as dividend income.
• B)Buddy recognizes $200,000 as a capital gain.
• C)Buddy recognizes $150,000 as dividend income.
• D)Buddy recognizes $150,000 as a capital gain.

Recognize the effects of cutting a magnet on its magnetic properties.

Describe natural sources of magnetism and their significance.

Explain the behavior of magnetic lines of force and the concept of magnetic domains.

Understand the relationship between electricity and magnetism, including electromagnetism.

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Definitions:

Deprivation

To be deprived; without; having to do without or unable to use.

Without

Indicates the absence of something or someone.

Unable

Lacking the skill, means, or opportunity to do something.

Guidelines for Good Health

Recommendations or principles directed toward maintaining or improving well-being through lifestyle choices and healthcare practices.