Question
In: Accounting
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. On March 15, 2018,...
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. On March 15, 2018, Blinkin sells his shares to Nod. How much income should Blinkin report from SleepEZ for 2018 under the daily allocation? Refer to the following table for the timing of SleepEZ’s income.
|
Period |
Income |
|
January 1 through March 15 (74 days) |
$100,000 |
|
March 16 through December 31 (291 days) |
345,500 |
|
January 1 through December 31, 2018 (365 days) |
$445,500 |
Solutions
Expert Solution
| Income ratio for January 1 through March 15 (74 days) | 1:1:1 | |||
| Income ratio after March 15 | 1:2 | |||
| Income allocation on the basis of daily allocation | ||||
| Income distributed to | ||||
|
Period |
Income | Winkin | Blinkin | Nod |
| January 1 through March 15 (74 days) | 1,00,000.00 | 33,333.33 | 33,333.33 | 33,333.33 |
| March 16 through December 31 (291 days) | 3,45,500.00 | 1,15,166.67 | 2,30,333.33 | |
| January 1 through December 31, 2018 (365 days) | 4,45,500.00 | 1,48,500.00 | 2,97,000.00 | |
| Income allocation on the basis of daily allocation | 8,91,000.00 | 2,97,000.00 | 5,60,666.67 | 33,333.33 |
ekkarill92 answered 2 years agoRelated Solutions
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed...
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corporation. In the conditions listed below, how much income should
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Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed...
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each report from SleepEZ for 2017 under both the daily allocation
and the specific identification allocation method? Refer to the
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Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed...
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S
corporation. In the conditions listed below, how much income should
each report from SleepEZ for 2016 under both the daily allocation
and the specific identification allocation method? Refer to the
following table for the timing of SleepEZ’s income.
Period
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days)
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Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed...
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S
corporation. In the conditions listed below, how much income should
each report from SleepEZ for 2018 under both the daily allocation
and the specific identification allocation method? Refer to the
following table for the timing of SleepEZ’s income.
Period
Income
January 1 through April 4 (94 days)
$
139,000
April 5 through December 31 (271 days)
405,000
January 1 through December 31, 2018 (365 days)
$
544,000
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Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S corporation. In the conditions listed...
Winkin, Blinkin, and Nod are equal shareholders in SleepEZ, an S
corporation. In the conditions listed below, how much income should
each report from SleepEZ for 2017 under both the daily allocation
and the specific identification allocation method? Refer to the
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