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:

Chest Physiotherapy

A set of therapies including percussion, vibration, and postural drainage, aimed at clearing mucus from the lungs to improve respiratory function.

Cystic Fibrosis

A genetic disorder that affects the lungs and digestive system, characterized by thick, sticky mucus production.

Thoracic Trauma

Injury to the chest area, which can affect the lungs, heart, and other components within the thoracic cavity.

Postural Drainage

A technique that uses gravity to assist in the drainage of mucus from the lungs and airways, often involving positioning the body in various ways.