Case study Lesson 7

ACC221_L7_Template__5-3_Start.xlsx

Case Study Part 1

ACC221 Lesson 7 Case Study Template
Name:
MEID:
Part 1
Scenario: Mary, Jill, Paula, and Petra formed Green Envy Co., a C corporation, on January 2, Year 1. Information regarding each shareholder's contributions and stock ownership is provided in the lesson.
Access the Shareholder Information
Instructions: Using the shareholder information provided in the lesson, complete the table below by entering the appropriate amounts in the associated cells. Enter gains as positive values and losses as negatives values. If a value is zero, enter a zero.
	Shareholder Gain Realized	Shareholder Gain Recognized	Shareholder Tax Basis in Stock	Corporation's Tax Basis in Noncash Property Received From Shareholder
Mary
Jill
Paula
Petra

ACC221 Lesson 7 Case Study Template
Name:
MEID:
Part 2
Scenario: Benjamin, Catheryn, Barb and Michael are knowledgeable about pool design. They have decided to pool their knowledge and resources to form Shallow Beach Enterprises Inc., a C corporation. They will provide professional services to area businesses and homeowners. All participants expect to work full time for Shallow Beach Enterprises, and each expects to contribute sufficient assets to become a 25% shareholder with total stock equity of $50,000 each.
In addition to the skills that each brings to the new entity, the owners will contribute assets that will enhance the company's ability to provide quality technical design and planning services. These assets include a building, land, pool excavating equipment, office furniture, and cash for initial operating expenses.
Access the Shareholder Assets Contributed Table
Instructions: For the following two shareholders in Rio Salado Enterprises Inc., determine the gain realized, gain recognized, and tax basis of the shares using the data in the lesson. Enter the amount for each item in the associated cells below. If a response is zero, enter a zero.
	Gain Realized	Gain Recognized	Tax Basis in Shares
Benjamin
Barb