Question

Andies Inc. owns all of the stock of Theatre Corp., the only asset of which is...

Andies Inc. owns all of the stock of Theatre Corp., the only asset of which is

acreage that had been used as one of the last surviving drive-in theatres, with

an adjusted basis of $60,000 and FMV of $150,000.    Andies’ basis in the

Theatre stock is $50,000. Yancy Corp wants to obtain the land so Theatre

exchanges the land for Yancy voting stock work $130,000 and then

liquidates.    The voting stock had been treasury stock that Yancy had bought

in the market for $100,000.    Yancy also transfers $1,000 cash in addition to

the voting stock.    How much gain will Theatre Corp. recognize from this

exchange? Explain your response.

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Answer #1

Solution:

Yancy will pay 130,000 worth of stock in return of drive in theaters balanced premise 60,000 and A's premise in theater stock worth 50,000

Andies inc claims the majority of the supply of theater partnership.

No trade of stock does not quality under segment on 1000 is material on like kind trade of genuine property for beneficial use in business for speculation.

in the event that yancy offers to trade exposure exchanged bonds for theater stock. An ought to acknowledge offer he can bond for speculation under area 100 and conceded charge.

Yancy will pay 130,000 worth of stock in return of drive in theaters balanced premise 60,000 and A's premise in theater stock worth 50,000

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