3. The Best of Boston, Inc. is a company that providescustomized tourist services, such as charters and sightseeing toursin the city of Boston. The company is owned 75% by Linda Smith and25% by her sister, Amy Smith. Linda has recently married and she ismoving with her husband to New York City. As such, Linda and Amyhave decided to liquidate the business. Linda will open a newbusiness, the Best of New York, once she is settled. She hasdecided to take two small vans that belong to Best of Boston, Inc.as her final distribution. Amy, on the other hand, will keep theexisting savings of $50,000. Please consider the followingquestions with respect to this case:
a. Assume you are Best of Boston’s accountant. Would you suggestan alternate strategy to minimize or avoid liquidation tax?
b. What gain or loss would Amy recognize?
c. Would Best of Boston recognize a loss on the distribution ofthe two vans?
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