(Solved): Discussion Question 5-2 (L. 0.3 ) Classify the effect of a distribution in a year when the distribut ...

Discussion Question 5-2 (L. 0.3 ) Classify the effect of a distribution in a year when the distributing corporation has the following conditions. a. A deficit in accumulated E & P and a positive amount in current E & . R. If a distributing corporation has a defict in accumulated E A. P. and a positive amount in current E A R, a distribution during the year is a

to the extent of current E& & Current and accomulated E & P

netted. b. A positive amount in accumulated E.8. P and a deflit in current E & R If the corporation has a positive amount in accumulated E & . P and a deficit in current E & . B. a distribution either is a

, depending on the resulting balance in E & P when current and accumulated E & P are netted. c. A deficit in both current and accumulated E & P. If there is a deficit in both current and accumulated E & . P, a corporate distribution is treated as a

to the extent of the shareholder's basis in his or her stock. Any excess is a

- d. A positive amount in both current and accumulated E & R If there is a positive amount in both current and accumulated E& P, to the extent of the positive balance in both amounts, the distribution is a

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