Micaela owns all the shares of the Madison Corporation that operates as an S corporation.Micaela's basis in the stock is $40,000.During the year she receives a cash distribution of $10,000 from Madison.What must Micaela and Madison report as income from the cash distribution?
$\begin{array} { l }
& \text { Micaela}& \text {Madison }\
a.&\$-0-&\$-0-\
b.&\$10,000&\$-0-\
c.&\$-0-&\$10,000\
d.&\$10,000&\$10,000\
\end{array}$

Question

Micaela owns all the shares of the Madison Corporation that operates as an S corporation.Micaela's basis in the stock is $40,000.During the year she receives a cash distribution of $10,000 from Madison.What must Micaela and Madison report as income from the cash distribution?
$\begin{array} { l  }
& \text { Micaela}& \text {Madison }\
a.&\$-0-&\$-0-\
b.&\$10,000&\$-0-\
c.&\$-0-&\$10,000\
d.&\$10,000&\$10,000\
\end{array}$

Quizplus · Accepted Answer

The Answer of Micaela owns all the shares of the Madison Corporation that operates as an S corporation.Micaela's basis in the stock is $40,000.During the year she receives a cash distribution of $10,000 from Madison.What must Micaela and Madison report as income from the cash distribution?
$\begin{array} { l  }
& \text { Micaela}& \text {Madison }\
a.&\$-0-&\$-0-\
b.&\$10,000&\$-0-\
c.&\$-0-&\$10,000\
d.&\$10,000&\$10,000\
\end{array}$

Micaela Owns All the Shares of the Madison Corporation That