A 18. Required informationKevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed thefollowing assets:Kevan:CashLandTotalsBasis$ 15,000120,000$ 135,000"Nonrecourse liability secured by the land equals $210,000.Each member received a one-third capital and profits interest in the LLC.Note: Leave no answer blank. Enter zero if applicable. Round to the nearest whole thousand.Albee, LLCTax Basis Balance SheetAssetsCashLandTotalsLiabilities and capitalMortgage debtCapital-KevanCapital-JerryCapital-DaveTotalsFair MarketValuee. Prepare a tax basis balance sheet for Albee LLC showing the tax capital accounts for the members. What is Kevan's share of theLLC's inside basis?Note: Enter any capital account with a debit balance as a negative amount.$ 15,000440,000$455,000Tax Basis

BS stands for balance sheet which one of the financial statements of the company along with cash…

Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed t following assets: Kevan: Cash Land Totals Basis $ 15,000 120,000 $ 135,000 Fair Market Value $15,000 440,000 $455,000 "Nonrecourse liability secured by the land equals $210,000.

Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed t following assets: Kevan: Cash Land Totals Basis $ 15,000 120,000 $ 135,000 Fair Market Value $15,000 440,000 $455,000 "Nonrecourse liability secured by the land equals $210,000.

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter12: Corporations: Organization, Capital Structure, And Operating Rules

Section: Chapter Questions

Problem 3BCRQ

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Required information Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Kevan: Cash Land* Totals Tax basis Fair Market Value *Nonrecourse liability secured by the land equals $210,000. Each member received a one-third capital and profits interest in the LLC. Note: Leave no answer blank. Enter zero if applicable. Round to the nearest whole thousand. Basis $ 15,000 120,000 $ 15,000 440,000 $ 135,000 $ 455,000 g. If the lender holding the nonrecourse liability secured by Kevan's land required Kevan to guarantee 1/3 of the liability and Jerry to guarantee the remaining 2/3 of the liability when Albee LLC was formed, what are the members' tax bases in their LLC interests? Kevan $285,000 X Answer is complete but not entirely correct. Jerry $ 285,000 $ Dave 285,000
Required information Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Kevan: Cash Land* Totals Basis Fair Market Value $ 15,000 120,000 $ 15,000 440,000 $ 135,000 $ 455,000 *Nonrecourse liability secured by the land equals $210,000. Each member received a one-third capital and profits interest in the LLC. Note: Leave no answer blank. Enter zero if applicable. Round to the nearest whole thousand. f. If the lender holding the nonrecourse liability secured by Kevan's land required Kevan to guarantee 1/3 of the liability and Jerry to guarantee the remaining 2/3 of the liability when Albee LLC was formed, how much gain or loss will Kevan recognize? X Answer is complete but not entirely correct. Gain or loss recognized $ 0X
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) b. What is Kevan’s tax basis in his LLC interest? Jerry Dave Kevan Gain or loss recognized
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) c. What tax basis do Jerry and Dave have in their LLC interests? Jerry Dave Tax basis
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) e. Prepare a tax basis balance sheet for Albee LLC showing the tax capital accounts for the members. What is Kevan’s share of the LLC’s inside basis? (Enter any capital account with a debit balance as a negative amount.) Albee , LLC Tax Basis Balance Sheet Tax Basis Assets: Cash Land Totals Liabilities and capital: Mortgage debt Capital-Kevan Capital-Jerry Capital-Dave Totals
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) a. How much gain or loss will Jerry, Dave, and Kevan recognize on the contributions? Jerry Dave Kevan Gain or loss recognized
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) f. If the lender holding the nonrecourse debt secured by Kevan’s land required Kevan to guarantee 33.33 percent of the debt and Jerry to guarantee the remaining 66.67 percent of the debt when Albee LLC was formed, how much gain or loss will Kevan recognize? Gain or loss recognized
Required information Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Kevan: Cash Land* Totals Basis $ 15,000 120,000 Assets: Cash Land Totals Liabilities and capital: Mortgage debt $ 15,000 440,000 $ 135,000 $ 455,000 *Nonrecourse liability secured by the land equals $210,000. Each member received a one-third capital and profits interest in the LLC. Note: Leave no answer blank. Enter zero if applicable. Round to the nearest whole thousand. Capital-Kevan Capital-Jerry Capital-Dave Totals e. Prepare a tax basis balance sheet for Albee LLC showing the tax capital accounts for the members. What is Kevan's share of the LLC's inside basis? Note: Enter any capital account with a debit balance as a negative amount. Albee, LLC Tax Basis Balance Sheet Fair Market Value Tax Basis $ $ 120,000 120,000 0
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) d. What is Albee LLC’s tax basis in its assets? Tax basis
Kevan, Jerry, and Dave formed Albee LLC. Jerry and Dave each contributed $245,000 in cash. Kevan contributed the following assets: Basis Fair Market Value Kevan: Cash $15,000 $15,000 Land* 120,000 440,000 Totals $135,000 $455,000 *Nonrecourse debt secured by the land equals $210,000 Each member received a 33.33 percent capital and profits interest in the LLC. (Leave no answer blank. Enter zero if applicable. Do not round intermediate calculations.) g. If the lender holding the nonrecourse debt secured by Kevan’s land required Kevan to guarantee 33.33 percent of the debt and Jerry to guarantee the remaining 66.67 percent of the debt when Albee LLC was formed, what are the members’ tax bases in their LLC interests? Kevan Jerry Dave Tax basis
On January 1, 2022, Sam and Sara formed a new business entity called Nice Brother Co. Sam contributes $250,000 cash and Sara contributes land with an adjusted basis of $300,000 and fair market value of $492,000 with a mortgage of $258,000 that is assumed by Nice Brother Co. Assume the following operating results for 2022: Sales $ 1,500,000 Interest income – from a bank $ 3,200 Royalties $ 60,000 Loss from sale of investment $ (7,000) Cost of goods sold $ 622,000 Salaries $ 450,000 Rent $ 144,000 Maintenance $ 24,000 Utilities $ 58,000 EPA penalty $ 1,000 Depreciation ? Charitable contribution $ 30,000 Payment to Sam for retirement* $ 15,000 *payment considered a guaranteed payment if the entity is a partnership The company’s only depreciable asset is equipment (useful life of 5 years) which will be purchased in 2022 for $100,000. The only asset sold was an investment purchased on 2/2/22 for $28,000 and sold on 11/4/22 for $21,000 What are the separately stated items allocated…
Required information When High Horizon LLC was formed, Maude contributed the following assets in exchange for a 25 percent capital and profits interest in the LLC: Fair Market Value Basis Maude: Cash Land* $ 20,000 20,000 100,000 360,000 $120,000 $380,000 Totals Nonrecourse debt secured by the land equals $160,000 James, Harold, and Jenny each contributed $220,000 in cash for a 25 percent profits and capital interest. (Leave no answer blank. Enter zero if applicable.) c. What tax basis do James, Harold, and Jenny have in their LLC interests? James Harold Jenny