Oscar Buys a 10% Interest in Britanny Corporation Paying $92,000

question 75

Multiple Choice

Oscar buys a 10% interest in Britanny Corporation paying $92,000 cash on January 1,2012.During 2012,Britanny Corporation reports a loss of $30,000 and pays cash dividends to shareholders of $10,000.For 2013,Britanny Corporation has a loss of $60,000 and pays cash dividends of $20,000.If Britanny Company is organized as an S Corporation,Oscar's basis in the Britanny Corporation stock at the end of 2013 is:

• A)$ 80,000
• B)$ 86,000
• C)$ 92,000
• D)$ 98,000
• E)$ 104,000

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Definitions:

Objective Function

A mathematical function used in optimization to define the goal of the solver, such as minimizing costs or maximizing profits.

Fabricating Department

A specialized part of manufacturing where products are assembled, shaped, or otherwise fabricated from raw materials.

Net Profit

The amount of money left over after all operating expenses, taxes, and costs have been subtracted from total revenue.

Binding Constraint

A limitation or restriction within an optimization problem that holds equality at the optimal solution; it actively influences the solution of the problem.