ACCT 553 STUDY Learn by Doing/acct553study.com ACCT 553 STUDY Learn by Doing/acct553study.com | Page 16

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ACCT 553 Week 6 You Decide
Mark, and John Case
Part I: Discuss the various forms of organization that are available to
Penelope, Mark, and John
Part II: Make your recommendation as to what form of organization
you believe will be best, and be sure to explain the reasoning for your
choice.
Part III: Discuss the tax consequences of contributing cash, property,
and/or services to the new entity.
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ACCT 553 Week 6 Homework

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Miyasyke, Inc., a calendar year S corporation, has five equal
shareholders at the end of the tax year. Miyasyke had
$75,000 of taxable income. Miyasyke made distributions to its
shareholders of $32,000 each, for a total of $160,000. Each
shareholder's basis in the S corporation is $100,000 at the beginning
of the tax year. What amount from Miyasyke should be included in
each shareholder's gross income?