Question

In: Accounting

An S corporation converted from a C corporation in 20X2 has the following: Built-in gains of...

An S corporation converted from a C corporation in 20X2 has the following: Built-in gains of $20,000 Taxable income, computed as if the corporation were a C corporation of $30,000 What is the built-in gains tax?

A. $3,000

B. $4,500

C. $7,000

D. $10,500

Solutions

Expert Solution

Answer is option C $7000

built-in gains tax rate = 35%

35% is multiplied by least of 20000 and 30000

Therefore,

built-in gains tax = 20000*35% = 7000

ekkarill92 answered 2 years ago
Next > < Previous

Related Solutions

Coke can be converted into CO in following reaction CO2(g) + C(s) -> 2CO(g). A coke...
Coke can be converted into CO in following reaction CO2(g) + C(s) -> 2CO(g). A coke that contains 84% carbon by mass and the balance noncombustible ash is fed to a reactor with a stoichiometric amount of CO2. The coke is fed at 77 oF, and the CO2 enters at 400 oF. Heat is transferred to the reactor in the amount of 5800 btu/lbm coke fed. The gaseous products and the solid reactor effluent (the ash and unburned carbon) leave...
Coke can be converted into CO in following reaction CO2(g) + C(s) -> 2CO(g). A coke...
Coke can be converted into CO in following reaction CO2(g) + C(s) -> 2CO(g). A coke that contains 84% carbon by mass and the balance noncombustible ash is fed to a reactor with a stoichiometric amount of CO2. The coke is fed at 77 oF, and the CO2 enters at 400 oF. Heat is transferred to the reactor in the amount of 5200 btu/lbm coke fed. The gaseous products and the solid reactor effluent (the ash and unburned carbon) leave...
An S corporation converted to a limited partnership and also concurrently elected as an association taxable...
An S corporation converted to a limited partnership and also concurrently elected as an association taxable as a corporation. Will such actions terminate it’s S corporation election? Explain
During 2018, Crown Corporation, a calendar year C corporation, has net short-term capital gains of $50,000,...
During 2018, Crown Corporation, a calendar year C corporation, has net short-term capital gains of $50,000, net long-term capital losses of $80,000, and taxable income from other sources of $270,000. Prior years' transactions included the following. 2014 net short-term capital gains $12,000 2015 net long-term capital gains 10,000 2016 net short-term capital gains 9,500 2017 net long-term capital gains 7,000 If an amount is zero, enter "0". a. How much is Crown's net capital loss for 2018? $ What is...
An S corporation is subject to the following tax(es). a.Built-in gains tax. b.Alternative minimum tax. c.Corporate...
An S corporation is subject to the following tax(es). a.Built-in gains tax. b.Alternative minimum tax. c.Corporate income tax. d.None of these choices are correct.
Coke can be converted into CO�a fuel gas�in the reaction CO2 (g) + C (s) ?...
Coke can be converted into CO�a fuel gas�in the reaction CO2 (g) + C (s) ? 2 CO (g) a coke that contains 84% carbon by mass and the balance noncombustible ash is fed to a reactor with a stoichiometric amount of CO2. The coke is fed at 77�F, and the CO2 enters at 400�F. Heat is transferred to the reactor in the amount of 5859 Btu/lbm coke fed, the gaseous products and the solid reactor effluent (the ash and...
The following are selected 20X2 transactions of Bishop Corporation. Sept 1   Purchased inventory from Smith Company...
The following are selected 20X2 transactions of Bishop Corporation. Sept 1   Purchased inventory from Smith Company on account for $50,000. Smith records purchases gross and uses a periodic inventory system. Oct 1    Issued a $50,000, 12-month, 8% interest-bearing note to Smith in payment of account. Oct 1    Signed a zero-interest bearing 12-month note for $54,000 from the Second Bank and received $50,000. Required: a. Prepare journal entries for the selected transactions above. b. Prepare adjusting journal entries at December...
A C corporation withh earnings and profits elects S corporation status in 20X1 and has the...
A C corporation withh earnings and profits elects S corporation status in 20X1 and has the following: Gross Receipts $100,000 Passive investment income $60,000 Expenses directly related to the passive investment income $10,000 Taxable income if the corporation had been a C corporation $30,000 A) 20,000 B) $29,167 C) $30,000 D)$50,000 What is the excess net passive investment income?
Limestone (CaCO3(s)) is fed into a kiln and converted into quicklime (CaO(s)) via the following reaction:...
Limestone (CaCO3(s)) is fed into a kiln and converted into quicklime (CaO(s)) via the following reaction: CaCO3(s) CaO(s) + CO2 (g) The heat used to drive this reaction comes from the combustion of methane in the kiln using 50% excess dry air. The limestone and air enter at 25°C, and the quicklime exits at 900°C. The combustion gases exit at 200°C. DHof, CH4, gas = -74.84 kJ/mol Cp (for all gases and vapors): 30 J/mol.K DHof, CaCO3, solid = -1206.9...
            5.   On June 16, 20X2, the accountant for D & S Lighting deposited the following...
            5.   On June 16, 20X2, the accountant for D & S Lighting deposited the following taxes in a local bank to pay the government: Employees’ federal income tax withheld $695 FICA—SOCIAL SECURITY tax (employees’ share) 214 FICA—SOCIAL SECURITY tax (employer’s share) 214 FICA—Medicare tax (employees’ share)    71 FICA—Medicare tax (employer’s share)    71 Prepare the general journal entry to record the payment (deposit) of these taxes to the federal government. (4 pts) General Journal Debit Credit 6. Ryan's...
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT