Identify Which of the Following Statements Is True

question 32

Multiple Choice

Identify which of the following statements is true.

• A)The assignment of income doctrine requires a cash method of accounting for a transferor/shareholder to recognize income when accounts receivable are transferred by the shareholder to the corporation in a Sec. 351 exchange in which no gain is otherwise recognized.
• B)The assignment of income doctrine is a legislative requirement that income be taxed to the person who earns it.
• C)The assignment of income doctrine does not apply if the transferor in a Sec. 351 exchange in which no gain is otherwise recognized transfers when a sole proprietor transfers substantially all the assets and liabilities of the transferor's trade or business to a controlled corporation.
• D)All of the above are false.

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Definitions:

Marketers

Professionals who are involved in the promotion and selling of products or services, including market research and advertising strategies.

Flight Attendant

An airline employee responsible for ensuring the safety, security, and comfort of passengers aboard flights.

Commercial Aircraft

A type of aircraft designed and used for transporting passengers and cargo for business purposes.

Liable

Legally responsible or obligated.