Clampett, Inc

question 41

Multiple Choice

Clampett, Inc.(an S corporation) previously operated as a C corporation.Under general rules, distributions from Clampett, Inc., are deemed to be paid in the following order:

• A)Shareholder's remaining stock basis, prior C corporation earnings and profit, the AAA account.
• B)Shareholder's remaining stock basis, the AAA account, prior C corporation earnings and profit.
• C)Prior C corporation earnings and profit, the AAA account, shareholder's remaining stock basis.
• D)The AAA account, prior C corporation earnings and profit, shareholder's remaining stock basis.
• E)None of the choices are correct.

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Definitions:

Self-Monitor

The act of observing and regulating one's own behavior in social situations to fit into the expected norms or to achieve personal goals.

Nonreactive

A state or characteristic of not responding to stimuli or environmental factors.

Reactive

Responding to stimuli or events after they have occurred, rather than initiating action preemptively.

Independent

The state of being free from outside control or not influenced by others, often used in the context of research to describe variables not affected by others.