Otter Corporation reported taxable income of $400,000 before the distribution described below.During the year, the company made a distribution of land to its sole shareholder, Emmet Jugg.The land's fair market value was $50,000 and its tax and E&P basis to Otter was $30,000.Emmet assumed a mortgage attached to the land of $10,000.Compute Otter's current E&P for year 1.

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The Answer of Otter Corporation reported taxable income of $400,000 before the distribution described below.During the year, the company made a distribution of land to its sole shareholder, Emmet Jugg.The land's fair market value was $50,000 and its tax and E&P basis to Otter was $30,000.Emmet assumed a mortgage attached to the land of $10,000.Compute Otter's current E&P for year 1.

Otter Corporation Reported Taxable Income of $400,000 Before the Distribution