Shannonowns


Question Description:

30

Shannonowns 100shares(100%)oftheBlueMoonScorporationatthebeginningoftheyear.OnMarch16(75daysintotheyear),Shannonsells30%ofhersharestoStephanie.BlueMoonproduces$100,000ofordinaryincomeduringtheyear($10,000ofincomethroughMarch16,and$90,000ofincomeafterMarch16).AssumingthereisanelectionmadetoterminatethetaxyearonMarch16,whatistheproperincomeallocationforShannonandStephanie? a. Shannon – $52, 176; Stephanie – $47,824. b. Shannon – $70,000; Stephanie – $30,000. c. Shannon – $76,164 – Stephanie – $23,836 d. Shannon – $73,000; Stephanie – $27,000

Answer

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