Parent Corporation Owns 100% of the Single Class of Stock

question 22

Multiple Choice

Parent Corporation owns 100% of the single class of stock of Subsidiary Corporation. Parent's basis in the Subsidiary stock is $500,000 when Parent completely liquidates Subsidiary Corporation within a single tax year. The Subsidiary Corporation assets have a $700,000 adjusted basis and an $800,000 FMV at liquidation. As a result of the liquidation, Parent must recognize a

• A)$0 gain.
• B)$200,000 gain.
• C)$300,000 gain.
• D)none of the above

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Definitions:

Mummification

A process of preserving the body after death by removing the internal organs, treating the body with chemicals, and wrapping it in cloth, practiced in ancient Egypt and other cultures.

Embalming

The process of preserving a body after death using chemicals to delay decomposition, often for funeral proceedings.

Cultural Aspect

The elements of culture, including beliefs, norms, and social practices, that influence the behavior and perceptions of individuals within a society.

Mourning Customs

The rituals and practices that a culture or society follows in expressing grief and commemorating the dead.