For Each of the Following Tax Treatments, Explain the Income

Essay

For each of the following tax treatments, explain the income tax concept(s) which is/are responsible for the treatment indicated.
a.Dorine purchased 500 shares of Russell Corporation common stock in June 2017 for $11,000. In November 2017, Dorine received 50 shares of Russell Corporation stock as a stock dividend when the stock was selling for $22 per share. At December 31, 2017, the 550 Russell Corporation shares were worth $13,000. In March 2018, Dorine sells the 550 shares for $13,500. Dorine recognizes no income in 2017 and $2,500 of income in 2018 from her investment in Russell Corporation stock.
b.Steven is the sole owner of Moray Corporation. Steven sells land to Moray that cost him $33,000 for $22,000. Steven is not allowed to deduct the $11,000 loss on the sale.
c.Danielle is the owner of Larson Company. In April, she attends a trade show in New York. She takes her daughter with her on the trip so she can go to museums and see some Broadway shows. The cost of Danielle's trip is deductible, but her daughter's costs are not deductible.
d.Earl is a vice-president of Laddy Corporation. In December 2018, the board of directors voted to give Earl a $20,000 bonus, payable on December 30, 2018. Earl tells the payroll clerk to delay processing the bonus check until January 4, 2019. Earl must include the $20,000 bonus in his 2018 gross income.?