Taxpayers Who Change from One Accounting Period to Another Must

question 1638

True/False

Taxpayers who change from one accounting period to another must annualize their income for the resulting short period.

---

Definitions:

Stock Split

A corporate action in which a company divides its existing shares into multiple shares to boost the liquidity of the shares.

Retained Earnings

The portion of net income that is retained by a company rather than distributed to its shareholders as dividends.

Common Stock Dividend Distributable

A liability account on the balance sheet representing a declaration of dividends by a company's board of directors that have not yet been paid out to shareholders.

Paid-in Capital

Funds received by a company in exchange for its stock, representing the equity capital contributed by shareholders.