Yellow Corporation Has a Deficit in Accumulated E & P

question 103

Multiple Choice

Yellow Corporation has a deficit in accumulated E & P of $600,000 and has current E & P of $450,000.On July 1,Yellow distributes $500,000 to its sole shareholder,Eugene,who has a basis in his stock of $105,000.As a result of the distribution,Eugene has:

• A)Dividend income of $450,000 and no adjustment to stock basis.
• B)Dividend income of $105,000 and reduces his stock basis to zero.
• C)Dividend income of $450,000 and reduces his stock basis to $55,000.
• D)No dividend income,reduces his stock basis to zero,and has a capital gain of $500,000.
• E)None of the above.

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Definitions:

Adaptive Behavior

The collection of conceptual, social, and practical skills that people learn and use in their daily lives to function effectively and meet societal standards.

Language Use

The manner in which words and phrases are utilized in communication, varying by context, cultural norms, and individual differences.

Personal-social Behavior

relates to the way an individual interacts with others in social contexts, reflecting aspects of their personality and social skills.

Arnold Gesell

Arnold Gesell was a developmental psychologist and pediatrician known for his research in child development and for proposing a series of developmental milestones.