Ron and Hermione formed Wizard Corporation on January 2. Ron contributed cash of $200,000 in return for 50 percent of the corporation’s stock. Hermione contributed a building and land with the following fair market values and adjusted bases in return for 50 percent of the corporation’s stock:

FMV Tax adjusted Basis
Building $75,000 $20,000
Land 175,000 80,000
Total $250,000 $100,000

To equalize the exchange, Wizard Corporation paid Hermione $50,000 in addition to her stock.
a. What amount of gain or loss does Ron realize on the formation of the corporation? What amount, if any, does he
recognize?
b. What is Ron's tax basis in the stock he receives in return for his contribution of property to the corporation?
c. What amount of gain or loss does Hermione realize on the formation of the corporation? What amount, if any, does she recognize?
d. What is Hermione's tax basis in the stock she receives in return for her contribution of property to the corporation?
e. What tax-adjusted basis does Wizard Corporation take in the land and building received from Hermione?
Assume Hermione's tax-adjusted basis in the land was $200,000.
f. What amount of gain or loss does Hermione realize on the formation of the corporation? What amount, if any, does she recognize?
g. What tax-adjusted basis does Wizard Corporation take in the land and building received from Hermione? Assume Hermione's tax-adjusted basis in the land was $250,000.
h. What amount of gain or loss does Hermione realize on the formation of the corporation? What amount, if any, does she recognize?
i. What tax-adjusted basis does Wizard Corporation take in the land and building received from Hermione?
j. What election can Hermione and Wizard Corporation make to allow Wizard Corporation to take a carryover basis in the land?

Which of the following is a reason why it is important for students to study strategy and the strategic management process? answers: studying strategy and the strategic management process can give students tools to evaluate the strategies of firms that may employ them. it can be very important to a new hire's career success to understand the strategies of the firm that hired them and their place in implementing these strategies. while strategic choices are generally limited to very experienced senior managers in large organizations, in smaller and entrepreneurial firms many employees end up being involved in the strategic management process. all of these.

Barbara jones opened barb’s book business on february 1, 2010. the company specilizes in editing accounting textbooks. you have been hired as manager. your duties include maintaining the company’s financial records. the following transactions occurred in february , the first month of operations. a. received shareholders' cash contributions on february 1 totaling $16,000 to form the corporation; issued 1,000 shares of common stock. b. paid $2,400 cash on february 2 for three months' rent for office space. tip: for convenience, simply record the full amount of the payment as an asset (prepaid rent). at the end of the month, this account will be adjusted to its proper balance. c. purchased and received supplies on february 3 for $300 cash. d. signed a promissory note on february 4, payable in two years; deposited $10,000 in the company's bank account. e. on february 5, paid cash to buy equipment for $2,500 and land for $7,500. f. placed an advertisement in the local paper on february 6 for $425 cash. g. recorded sales on february 7 totaling $1,800; $1,525 was in cash and the rest on accounts receivable. h. collected accounts receivable of $50 from customers on february 8. i. on february 9, repaired one of the computers for $120 cash. tip: most repairs involve costs that do not provide additional future economic benefits. j. incurred and paid employee wages on february 28 of $420.required: set up appropriate t-accounts for cash, accounts receivable, supplies, prepaid rent, equipment, furniture and fixtures, notes payable, contributed capital, service revenue, advertising expense, wages expense, and repair expense. all accounts begin with zero balances. tip: when preparing the t-accounts, you might find it useful to group them by type: assets, liabilities, stockholders’ equity, revenues, and expenses.2. record in t-accounts the effects of each transaction in february, referencing each transaction in the accounts with the transaction letter. show the unadjusted ending balances in the t-accounts. 3. prepare an unadjusted trial balance at the end of february.4. refer to the revenues and expenses shown on the unadjusted trial balance. based on this information, write a short memo offering your opinion on the results of operations during the first month of business.

Acompany recorded a check in its accounting records as $87. however, the check was actually written for $78 and it cleared the bank as $78. what adjustment is needed to the personal statement? a. decrease by $9 b. increase by $9 c. decrease by $18 d. increase by $9