Questions: Cn 19 P 19-64 Required information Problem 19-64 (LO 19-5) (Algo) Jefferson Millinery Incorporated (JMI) decided to liquidate its wholly owned subsidiary, 8 Miles High Incorporated (8MH). 8 MH had the following tax accounting balance sheet Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Adjusted Tax FMV Basis Cash 249,750 249,750 Building 61,250 16,250 45,000 Land 188,500 113,500 75,000 Total 499,500 379,500 120,000 Problem 19-64 Part c (Algo) c. What is JMI's adjusted tax basis in the building and land after the complete liquidation?

Cn 19 P 19-64 Required information Problem 19-64 (LO 19-5) (Algo) Jefferson Millinery Incorporated (JMI) decided to liquidate its wholly owned subsidiary, 8 Miles High Incorporated (8MH). 8 MH had the following tax accounting balance sheet Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. Adjusted Tax FMV Basis Cash 249,750 249,750 Building 61,250 16,250 45,000 Land 188,500 113,500 75,000 Total 499,500 379,500 120,000 Problem 19-64 Part c (Algo) c. What is JMI's adjusted tax basis in the building and land after the complete liquidation?
Transcript text: $\operatorname{Cn} 19$ P $19-64$ Saved Part 3 of 3 3.34 points $\square$ References ! Help Save \& Exir Submit Check my work Required information Problem 19-64 (LO 19-5) (Algo) [The following information applies to the questions displayed below.] Jefferson Millinery Incorporated (JMI) decided to liquidate its wholly owned subsidiary, 8 Miles High Incorporated (8MH). 8 MH had the following tax accounting balance sheet Note: Negative amount should be indicated by a minus sign. Leave no answer blank. Enter zero if applicable. \begin{tabular}{lrrr} & \multicolumn{3}{c}{ Adjusted Tax } \\ & FMV & \multicolumn{2}{c}{ Basis } \\ Cash & $\$ 249,750$ & $\$ 249,750$ & \\ Building & 61,250 & 16,250 & 45,000 \\ Land & 188,500 & 113,500 & 75,000 \\ \hline Total & $\$ 499,500$ & $\$ 379,500$ & $\$ 120,000$ \\ \hline \hline \end{tabular} Problem 19-64 Part c (Algo) c. What is JMI's adjusted tax basis in the building and land after the complete liquidation?
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Solution

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Solution Steps

Step 1: Determine JMI's basis in the building

JMI's adjusted tax basis in the building after the liquidation is the same as 8MH's adjusted basis before the liquidation, which is $16,250.

Step 2: Determine JMI's basis in the land

JMI's adjusted tax basis in the land after the liquidation is the same as 8MH's adjusted basis before the liquidation, which is $113,500.

Step 3: Determine JMI's total basis in the building and land

JMI's total adjusted tax basis in the building and land is the sum of the adjusted basis in the building and the adjusted basis in the land: $16,250 + $113,500 = $129,750.

Final Answer:

$129,750

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