Identify Which of the Following Statements Is True

question 78

Multiple Choice

Identify which of the following statements is true.

• A)Convertible debt issues might be considered "stock" for purposes of the S corporation single class of stock requirement.
• B)The S election must be made no later than the fifteenth day of the fourth month of the tax year for which the election is to be effective.
• C)A majority of shareholders must consent to the S corporation election.
• D)All of the above are false.

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Definitions:

Compound Interest

The calculation of interest on the initial principal, which also includes all of the accumulated interest from previous periods on a deposit or loan.

Present Value

The current worth of a future sum of money or stream of cash flows, given a specified rate of return, reflecting the time value of money.

Earnings Rate

The rate at which an investment or savings account generates income over a specific period of time.

Net Present Value

A financial metric that estimates the profitability of investments by calculating the difference between the present value of cash inflows and outflows over a period of time.