Under a Plan of Complete Liquidation, Coast Corporation Distributes Land

question 97

Multiple Choice

Under a plan of complete liquidation, Coast Corporation distributes land with a $300,000 adjusted basis and a $400,000 FMV to William, a 25% shareholder. William has a $200,000 basis in his Coast stock. The land is inventory in the hands of Coast Corporation. Coast Corporation must recognize

• A)no gain.
• B)$100,000 of ordinary income.
• C)$100,000 of long-term capital gain.
• D)$200,000 of ordinary income.

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Farmers

Individuals engaged in agriculture, aiming at cultivating plants and livestock for food and raw materials.

Law

Law signifies a system of rules that are created and enforced through social or governmental institutions to regulate behavior.

Firewood

Fuel consisting of logs, sticks, or wood chips that are burned for warmth or cooking.

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