The Stock of Penguin Corporation Is Held as Follows: 85

question 6

Multiple Choice

The stock of Penguin Corporation is held as follows: 85% by Duck Corporation and 15% by Gerald, an individual. Penguin Corporation is liquidated in December of the current year, pursuant to a plan adopted earlier in the year. Penguin Corporation distributes land with a basis of $350,000 and fair market value of $390,000 to Gerald in liquidation of his stock interest. Gerald had a basis of $200,000 in his Penguin stock. How much gain will Penguin Corporation recognize in this liquidating distribution?

• A)$0.
• B)$40,000.
• C)$190,000.
• D)$390,000.
• E)None of the above.

---

Definitions:

Logical Positivism

A philosophical approach that asserts the meaning of statements lies in their empirically verifiable conditions, emphasizing logic and science.

Operational Definitions

Specific descriptions of the procedures or measures used to define research variables.

Quantitative Research

A systematic investigation utilizing statistical, mathematical, or computational techniques to analyze measurable data and phenomena.

Symbolic Interactionism

A sociological perspective focusing on the symbolic meaning that people develop and rely upon in the process of social interaction.