The stock of Mulberry Corporation is owned by Archana (60%) and Anar (40%), who are mother and daughter.

Pursuant to a plan of complete liquidation adopted earlier in the current year, Mulberry distributes land worth $575,000 to Anar (basis of $100,000 in Mulberry stock).

The land was purchased by Mulberry Corporation three years ago for $650,000, and it is distributed subject to a liability of $425,000.

What amount of gain or loss is recognized by Mulberry Corporation and by Anar with respect to the distribution of the land?

Solution and Explanantion:

Determining the gain or loss recognized by M corporation

Loss to be recognised = Market Value – Purchase Value

= $75000

Thus, loss to be recognised by the “M” corporation is $75000

Determining the gain or loss of A:

= ($40000)

Thus, loss to be recognised by A is $40000

hello the answer is d

if it is for a job, then you should learn everything you can about the job, like what does it involve, what qualification is required and how you are the right person for that job. dress appropriately for the interview. get plenty of rest the night before. good luck!