Jones purchase the stock of Smithon outright leaving Smithon intact? The stock should not be purchase by Mr. Jones. Mr. Jones acquiring the assets, liabilities and also would inherit the contractual obligations of the selling corporation, would, be the results of the purchase. In lay terms, he has bought the existing Smithon Corporation and he is responsible of ensuring daily operations run efficiently but the tax aspect of acquisition he is responsible for existing and any future tax liabilities that the selling corporation had. It would be my advice for Mr. Jones to not buy the stock because of the liability of current and future tax obligations which Mr. Jones would incur from the purchase of the stock.
Inversely, when a share repurchase is seen as treasury stock, the cost of the treasury stock is naturally disclosed as a decrease in total shareholders’ equity. Alcoa would report the purchase of the treasury stock by debiting treasury stock and crediting cash for the charge of the purchase. The treasury stock ought to be disclosed independently in the shareholders' equity area of Alcoa’s balance sheet as an unallocated cut of shareholders' equity. These shares are treated as issued although not part of common stock outstanding. If subsequently resold for a sum larger than the cost, Alcoa should report for the sale of the treasury stock by debiting cash for the sale cost, crediting treasury stock for cost, and crediting additional paid-in capital from repurchased stock for the excess of the selling price over the cost.
Jones don’t purchase the stock of Smithton outright. If Mr. Jones did purchase this stock outright it would cause him to acquire the assets, liabilities, and any contractual obligation that are outstanding of Smithton. According to the text Mr. Jones would be completely liable for any existing and future tax liabilities of Smithton. Because the Smithton wouldn’t cease to exist the purchase of stock wouldn’t be recommended for Mr. Jones. Since Smithton’s basis or tax schedule would not be change.
He breaks down what the stores charge us in order to sell the product at a price we will pay, so the store can still make a profit on the item. He explains that from the buyer’s standpoint, what he or she pays is a cost. That is not the case, the sellers
* What are the legal requirements? * Didn’t break any laws, related to him applying company funds towards personal use even though his act was solely beneficial to himself alone. What are the ethical duties? * Maintain price-competitive markets will ensure that scares resources are used to optimally satisfy consumer needs. * Pareto Optimality wasn’t obtained because maximum benefits of most wanted goods and services produced at minimum cost of least wanted resources.
10. Conway is not the one who had a risk of loss. Being a merchant Larsen has the risk of loss and should pay Conway back 13. The owner of the land can ask for the lumber back because he is not a merchant therefore is allowed to take back what is rightfully his. 1.
Memo To: Chip & Charles Carroway, Carroway Clothing Limited (CCL) From: Date: Re: Current accounting issues, employment benefits and financing options. Thank you for the opportunity to address the current accounting issues, employment benefits and financing options facing Carroway Clothing Limited (CCL) 1. SR& ED and Development costs treatment: In reviewing the financial statements it appears that the development costs and SR&ED treatment may not have been recorded appropriately. The SR&ED are tax credits to be used towards taxable income and should not have been recorded as government grants. Since CCL may not have needed them in the initial years, it can use SR&ED tax credits against taxable income
Specifically he would like to deduct it other than as a miscellaneous itemized deduction, which would give him no tax benefit due to the Alternative Minimum Tax. Discussion and conclusion: Since Joshua’s damage award is considered part of his gross income, the concern is whether he can deduct the contingency- based attorneys fees. If the damage incurred in connection with a trade or business, than he would be able to deduct this expense on schedule C, assuming he is self-employed. Or he can deduct it as a miscellaneous itemized deduction; due to the fact that he is subject to the
The court said this position was arbitrary and subverted common sense and, in the absence of case law or regulations, the IRS should not create ambiguity where there was none. The court held it undisputed that the Carter Trust, not its trustee, was the taxpayer. The trust’s participation in the ranch operations entailed an assessment of the activities of those who labored on the ranch, or otherwise conducted ranch business on the trust’s behalf. Their collective activities during the times in question were regular, continuous and substantial enough to constitute material participation. The court concluded the losses the Carter Trust had sustained were not passive within the meaning of section 469.
A C Corporation is considered an entirely separate entity and those that make up the company such as officers, directors, managers, and shareholders are not personally liable for the acts of the company. This is the main advantage of a C Corporation. A disadvantage is that profits of the corporation are taxed at two different levels. One at the corporate level and then another on the dividends of the shareholders. · Liability-A C Corporation has limited liability in that it is seen as a separate entity from the owners, which in turn protects their personal assets from being taken to pay for the company’s debt or liability losses.