Question

Exercise 2-29 (Algorithmic) (LO. 2)

Compute the charitable contribution deduction (ignoring the percentage limitation) for each of the following C corporations.

If required, round your answers to nearest dollar.

a. Amber Corporation donated inventory of clothing (basis of $121,000, fair market value of $151,250) to a qualified charitable organization that operates homeless shelters.
$

b. Brass Corporation donated stock held as an investment to Western College (a qualified organization). Brass acquired the stock three years ago for $82,800, and the fair market value on the date of the contribution is $132,480. Western College plans on selling the stock.
$

c. Ruby Corporation donates a sculpture held as an investment and worth $172,800 to a local museum (a qualified organization), which exhibits the sculpture. Ruby acquired the sculpture four years ago for $69,120.
$

Answer 1

Answer : A - donation allowable in case of Ambar corporation donated the inventory is 136125$ ( 121000+15125)

B - charitable contribution deduction in case of brass corporation stock held has an investment to western college is to the extent of fair market value on the date of contribution

That is 132480$

C -in case of ruby corporation donated the sculpture held as an investment the deduction is allowable is present value of investment as it donated to the qualified organisation deduction allowed is 172800$