Given the following details, what are the seller's net proceeds from a stock sale and an...

Given the following details, what are the seller's net proceeds from a stock sale and an asset sale? Please show all work

Details:

Corporate tax rate: 38%

Capital gains rate: 20%

Stock sale:

Purchase price $4,000.0 million

Stock basis: $1,000.0 million

Asset sale:

Purchase price: 4,000.0 million

Asset basis: $1,000.0 million

Expert Solution

Net proceeds from stock sale
Particulars	Amount in $' million)
Purchase price	4,000
Stock basis	(1,000)
Proceeds from stock sale	3,000
Tax (38% of proceeds)	(1,140)
Net proceeds from stock sale	1,860


Net proceeds from asset sale
Net proceeds from asset sale	Amount in $' million)
Purchase price	4,000
Asset basis	(1,000)
Proceeds from asset sale	3,000
Tax (20% of proceeds)	(600)
Net proceeds from asset sale	2,400

ekkarill92 answered 1 year ago

Ex. 5 Using the following information: Purchase of treasury stock $40,000 Proceeds from sale...

Ex. 5 Using the following information: Purchase of treasury stock $40,000 Proceeds from sale of equipment 25,000 Interest expense on borrowing 3,000 Issuance of bonds payable 52,500 Payment of dividends 10,000 Gain on sale of equipment 2,000 Stock dividends 15,000 Issuance of common stock 20,000 Compute the cash flow from financing activities. Compute the cash flow from investing activities.

Computing and Recording Proceeds from the Sale of PPE The following information was provided in the...

Computing and Recording Proceeds from the Sale of PPE The following information was provided in the 2018 10-K of Hilton Worldwide Holdings, Inc. Note 7: Property and Equipment ($ millions) 2018 2017 Property and equipment, gross $1,102 $1,044 Accumulated depreciation (625) (585) Property and equipment, net 477 459 Note 7 also revealed that depreciation expense on property and equipment totaled $70 million in 2018. The cash flow statement reported that expenditures for property and equipment totaled $94 million in 2018...

The sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale are

The sale of a depreciable asset resulting in a loss indicates that the proceeds from the sale are a) Lesser than carrying amount b) Less than current fair value c) Lesser than cost d) Greater than carrying amount e) Greater than cost

There are four ways tax consequences may affect the after-tax net proceeds received from the sale...

There are four ways tax consequences may affect the after-tax net proceeds received from the sale of an asset. Describe the four ways and the tax impact in paragraph and examples in detail.

17) Ordinarily, the proceeds from the sale of a bond issue will be

17) Ordinarily, the proceeds from the sale of a bond issue will beA) The face amount of the bond. B) The total of the face amount plus all interest payments C) The present value of the face amount plus the present value payments D) The face amount of the bond plus the equal to: present value of the stream of interest payments. 18) A S500,000 bond issue sold at 98. Therefore, the bonds:A) Sold at a discount because the B) Sold...

Given this information: What are the Full (Dirty) proceeds of the sale of this bond closest to on August 19th, 2020?

Agro Bonds were issued several years ago. Investor Gadget sells $100 par of the bonds mid-accrual period settlement on 8/19/2020.Coupon = 6%; Coupon Payment Frequency Semi-annual; Interest Payment Dates are March 31 and Sept 30th; Maturity Date September 30th, 2023; Day Count Convention = 30/360; Yield-to-Maturity 4%Given this information: What are the Full (Dirty) proceeds of the sale of this bond closest to on August 19th, 2020?(assume the bond does not accrue interest on 8/19)

Seydou Corp. transactions for the year ended 2019 included the following: [24] ◊――――――――――――――――――――――――――◊ Proceeds from Sale...

Seydou Corp. transactions for the year ended 2019 included the following: [24] ◊――――――――――――――――――――――――――◊ Proceeds from Sale of Land: 168,000 Proceeds from Long-Term Borrowing: 420,000 Plant Assets Purchased: 164,000 Inventories Increase: 700,000 Sale of Szalai Inc. common stock: 120,000 Dividends Paid: 60,000 Proceeds from sale of Treasury Notes: 52,000 Sale of Seydou Corp. common stock: 250,000 ◊――――――――――――――――――――――――――◊ Seydou Corp. Cash Flow from Investing for 2019 is? Edin Corp. financial statements are as follows: [25] Balance Sheet on: Dec 31, 2019 |...

Computing the Proceeds from the Sale of Notes Receivable Below are several customer notes receivable that...

Computing the Proceeds from the Sale of Notes Receivable Below are several customer notes receivable that were sold without recourse. An $8,000, 60-day, non-interest-bearing note sold after 15 days at 12%. A $10,000, 12%, 60-day note sold after 30 days at 14%. A $4,000, 10%, 90-day note sold after 30 days at 12%. A $10,000, 12%, 120-day note sold after 45 days at 15%. Required: Determine the proceeds from each of the preceding sales of customer notes receivable. (Assume a...

What does "Proceeds from initial public offering and private placement, net underwriting of discounts and commissions...

What does "Proceeds from initial public offering and private placement, net underwriting of discounts and commissions and other offering cost" and "proceeds from international employee stock sales to be remitted to employees and tax authorities" mean in the cash from financing activities section of the cash flow statement mean?

1)Which of the following is not taken into consideration in computing the seller's amount realized from...

1)Which of the following is not taken into consideration in computing the seller's amount realized from the exchange of property? a. Debt that the buyer assumes b. Commissions paid by the seller c. Legal fees paid by the seller in conjunction with the sale d. All of the above are taken into consideration in computing amount realized e. None of the above are taken into consideration in computing amount realized 2) An apartment building owned by Frank was condemned by...

Question