Blue Corporation Distributes Property to Its Sole Shareholder, Zeke

question 41

Multiple Choice

Blue Corporation distributes property to its sole shareholder, Zeke. The property has a fair market value of $450,000, an adjusted basis of $305,000, and is subject to a liability of $250,000. Current E & P is $550,000. With respect to the distribution, Blue has a gain of:

• A) $200,000 and Zeke has dividend income of $450,000.
• B) $145,000 and Zeke's basis is the distributed property is $305,000.
• C) $200,000 and Zeke's basis in the distributed property is $450,000.
• D) $145,000 and Zeke has dividend income of $200,000.
• E) None of the above.

Explain the legal outcomes concerning purchases made under conditional sale agreements and the role of registration in protecting interests.

Analyze the effects of internationalization on legal aspects of security for debt.

Explain the process and implications of liens within commercial property renovation projects.

Understand the implications of bankruptcy for conditional sale agreements and the rights of bona fide purchasers.

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Definitions:

Suburbanization

describes the process in which residential areas develop outside of city centers, often characterized by lower density, single-family homes, and reliance on automobile transport.

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Federal Research Grants

Financial funding provided by the federal government to support research projects in areas like science, technology, education, and health.