Test1problems

Each problem worth 15 Points Show all your calculations Problem # 1Mark and Jain form X corporation with the following consideration: Consideration Transferred Basis toFMVNumber of Shares TransferorReceived From Mark Cash40,00040,000 Installment Obligation140,000360,00040 From Jonathan (Jain)?40,0004 Services Calculate Realized and recognizedgain/loss, basis to each shareholder. Also calculate basis to X corporation for Installment Obligation. Problem # 2 Calculate DRD-ownership 15% Green Corporation Income from Operation600,000 Expenses from operations750,000 Qualifying Dividends300,000 Problem # 3 Zeta corporation have the following income and deductions for the current year Sales60,000 Cost of sales40,000 Other operating expenses40,000 Dividends (from 5% owned corporation)60,000 Zeta made charitable contribution of 60,000 to a qualified charity. Calculate Charitable deduction for the current year and carryover if any. Problem 4 Net Income per books200,000 Federal Income Taxes42,000 Life Insurance proceeds on key employee200,000 Tax Exempt interest23,000 Net Capital Loss3,000 Premium on life insurance5,000 Calculate Taxable Income Problem 5Dick, a cash basis taxpayer, incorporates his sole proprietorship. He transferred the following itmes to newly created Orange corporation. Fair Market Cash$40,000$40,000 Building100,000175,000 150,000150,000 (b) Calculate Dick's basis in stock © Calculate Orang's basis in assets received from Dick. Problem 6Excusive of capital Transactions, X corporation had 150,000 taxable income Its capital gains and losses are as follows Short Term Capital Gain40000 Short Term Capital Loss -75000 Long Term Capital Gain30000 Long Term Capital Loss-25000 a Calculate taxable income Problem 7John and Mary acquired stock in 2009 in a small business corporation for $150,000. This year corporation declared bankrupcy and stock becme worthless. They file joint return. Their other income is $180,000. Calculate their AGI