Question 1 3.33333 out of 3.33333 points Cardinal, the parent corporation, has a basis of $440,000 in the stock of Vulture Corporation, a subsidiary in which it owns 90% of all classes of stock. Cardinal purchased the stock in Vulture Corporation 10 years ago. In the current year, Cardinal Corporation liquidates Vulture Corporation and acquires assets worth $500,000 with a tax basis to Vulture Corporation of $380,000. What basis will Cardinal Corporation have in the assets acquired from Vulture Corporation? (Ch6 L4 Pg2) Selected Answer: $380,00 0. Answers: $380,00 0. $500,00 0. $ - 0-. $440,00 0. Response Feedback: Unless a parent corporation elects under Section 338, property received by the parent corporation in a complete liquidation of its subsidiary under Section 332 has the same basis it had in the hands of the subsidiary. The parent's basis in stock of the liquidated subsidiary disappears. Example 39  Question 2 3.33333 out of 3.33333 points What amount of accumulated earnings of a manufacturing corporation is considered within the reasonable needs of a business without the corporation having to show a bona fide business reason for the accumulation? (Ch3 L1 Pg15) Selected Answer: $250,000 or less. Answers: $250,000 or less. $300,000 or less. $200,000 or less. $150,000 or less. Response Feedback: The minimum Accumulated Earnings Credit for most corporations is $250,000, however, for certain Personal Service Corporations, the credit is limited to $150,000. p. 6 13  Question 3 0 out of 3.33333 points Susie exchanges stocks she owns in Quasar Corporation for stock in Lunar Corporation plus a bond worth $74,000 (principal amount of $70,000). The exchange is pursuant to a tax-free reorganization of both corporations. Susie paid $260,000 for the stock in Quasar four (4) years ago. The Lunar stock is worth $360,000. Susie recognizes gain on the transaction of: (Ch7, in book 7-1b example 3) Selected Answer: $100,0 00. Answers: $100,0 00. $74,00 0. $70,00 0. $-0-. Response Feedback : Susie's gain is $74,000, the fair market value of the bond. Gain is recognized when the principal amount of the securities received is greater than the principal amount of the securities surrendered. Susie surrendered no bonds. The amount of gain recognized is equal to the fair market value of the excess securities received. p. 7-7, Example 3, and Section 356(a)  Question 4 3.33333 out of 3.33333 points A personal service corporation engaged in health care has $250,000 of Accumulated Earnings And Profits at the end of 2017. During 2018, the corporation accumulated an additional $80,000 of