Aggie corporation made a distribution of $500,000 to rusty cedar in partial liquidation of the company on december 31 of this year. rusty, an individual, owns 100 percent of aggie corporation. the distribution was in exchange for 50 percent of rusty’s stock in the company. at the time of the distribution, the shares had a fair market value of $200 per share. rusty’s income tax basis in the shares was $50 per share. aggie had total e& p of $8,000,000 at the time of the distribution.

(a) what is the amount and character (capital gain or dividend) of any income or gain recognized per share by rusty as a result of the partial liquidation?
(b) assuming aggie made no other distributions to rusty during the year, by what amount does aggie reduce its total e& p as a result of the partial liquidation?

University hero is considering expanding operations beyond its healthy sandwiches. jim axelrod, vice president of marketing, would like to add a line of smoothies with a similar health emphasis. each smoothie would include two free health supplements such as vitamins, antioxidants, and protein. jim believes smoothie sales should fill the slow mid-afternoon period. adding the line of smoothies would require purchasing additional freezer space, machinery, and equipment. jim provides the following projections of net sales, net income, and average total assets in support of his proposal. sandwichesonly sandwiches and smoothies net sales $ 750,000 $ 1,350,000 net income 120,000 210,000 average total assets 350,000 750,000 return on assetschoose numerator ÷ choose denominator = return on assets÷ = return on assets÷ = profit margin÷ = profit margin÷ = asset turnover÷ = asset turnover÷ = times

Below are the steps in the measurement process of external transactions. arrange them from first (1) to last (6). event step post transactions to the general ledger. assess whether the transaction results in a debit or credit to account balances. use source documents to identify accounts affected by an external transaction. analyze the impact of the transaction on the accounting equation. prepare a trial balance. record the transaction in a journal using debits and credits.

Jaguar has full manufacturing costs of their s-type sedan of £22,803. they sell the s-type in the uk with a 20% margin for a price of £27,363. today these cars are available in the us for $55,000 which is the uk price multiplied by the current exchange rate of $2.01/£. jaguar has committed to keeping the us price at $55,000 for the next six months. if the uk pound appreciates against the usd to an exchange rate of $2.15/£, and jaguar has not hedged against currency changes, what is the amount the company will receive in pounds at the new exchange rate?