Oriole Inc.decided to liquidate its wholly owned subsidiary, Tiger Corporation.Tiger had the following tax accounting balance sheet.
$$\begin{array} { l r r r r }
&&& \
& \text { Tax Basis } & \text { FMV } & \text { Appreciation } \

\text { Cash } & \$ 400,000 & \$400,000 & \
\text { Building } & 100,000 & 20,000& 80,000 \
\text { Land } & \underline{300,000 }&\underline{ 180,000 }& \underline{120,000} \
\text { Total}&\underline{ \$ 800,000} &\underline{ \$ 600,000} & \underline{\$ 200,000}\
\end{array}$$ a.What amount of gain or loss does Tiger recognize in the complete liquidation?
b.What amount of gain or loss does Oriole recognize in the complete liquidation?
c.What is Oriole's tax basis in the building and land after the complete liquidation?

Question

Oriole Inc.decided to liquidate its wholly owned subsidiary, Tiger Corporation.Tiger had the following tax accounting balance sheet.
 $$\begin{array} { l r r r r } 
&&& \
& \text { Tax Basis } & \text { FMV } &  \text { Appreciation } \

\text { Cash } & \$ 400,000 & \$400,000 & \
\text { Building } & 100,000 & 20,000& 80,000 \
\text { Land } & \underline{300,000 }&\underline{ 180,000 }& \underline{120,000} \
\text { Total}&\underline{ \$ 800,000} &\underline{ \$ 600,000} & \underline{\$ 200,000}\
\end{array}$$  a.What amount of gain or loss does Tiger recognize in the complete liquidation?
b.What amount of gain or loss does Oriole recognize in the complete liquidation?
c.What is Oriole's tax basis in the building and land after the complete liquidation?

Quizplus · Accepted Answer

The Answer of Oriole Inc.decided to liquidate its wholly owned subsidiary, Tiger Corporation.Tiger had the following tax accounting balance sheet.
 $$\begin{array} { l r r r r } 
&&& \
& \text { Tax Basis } & \text { FMV } &  \text { Appreciation } \

\text { Cash } & \$ 400,000 & \$400,000 & \
\text { Building } & 100,000 & 20,000& 80,000 \
\text { Land } & \underline{300,000 }&\underline{ 180,000 }& \underline{120,000} \
\text { Total}&\underline{ \$ 800,000} &\underline{ \$ 600,000} & \underline{\$ 200,000}\
\end{array}$$  a.What amount of gain or loss does Tiger recognize in the complete liquidation?
b.What amount of gain or loss does Oriole recognize in the complete liquidation?
c.What is Oriole's tax basis in the building and land after the complete liquidation?

Oriole Inc AWhat Amount of Gain or Loss Does Tiger Recognize in Had