Prime Corporation Liquidates Its 85%-Owned Subsidiary Bass Corporation Under the Provisions

question 61

Multiple Choice

Prime Corporation liquidates its 85%-owned subsidiary Bass Corporation under the provisions of Secs.332 and 337.Bass Corporation distributes land to its minority shareholder,John,who owns a 15% interest.The property received by John has a $55,000 FMV.The land was used in the Bass Corporation's business and has a $65,000 adjusted basis and is subject to a $10,000 liability,which is assumed by John.John's basis in his stock is $25,000.What gain or loss will John and Bass Corporation recognize on the distribution of the land?

---

Definitions:

Benefits

Advantages or positive outcomes that result from a particular action or policy.

Particular Advantages

Specific benefits or positive aspects unique to a situation, method, or product.

AIDA Plan

A marketing strategy framework that stands for Attention, Interest, Desire, and Action, used to guide the consumer journey towards making a purchase.

Social Media

Digital platforms that facilitate the creation and sharing of information, ideas, personal messages, and other content.