ParentCo purchased all of the stock of SubCo on January 1, 2011, for $500,000. SubCo produced a loss for 2011 of $150,000 and distributed cash of $25,000 to ParentCo. In 2012, SubCo generated a loss of $450,000; in 2013, it recognized net income of $45,000. What is ParentCo's capital gain or loss if it sells all of its SubCo stock to a nongroup member on January 1, 2014, for $50,000?
A) $10,000.
B) $50,000.
C) ($80,000).
D) ($50,000).

Question

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The Answer of ParentCo purchased all of the stock of SubCo on January 1, 2011, for $500,000. SubCo produced a loss for 2011 of $150,000 and distributed cash of $25,000 to ParentCo. In 2012, SubCo generated a loss of $450,000; in 2013, it recognized net income of $45,000. What is ParentCo's capital gain or loss if it sells all of its SubCo stock to a nongroup member on January 1, 2014, for $50,000?
A) $10,000.
B) $50,000.
C) ($80,000).
D) ($50,000).

ParentCo Purchased All of the Stock of SubCo on January