Identify Which of the Following Statements Is True

question 38

Multiple Choice

Identify which of the following statements is true.

• A)When the acquiring corporation makes the Sec. 338 election, the target corporation is treated in many respects as a new corporation.
• B)A Sec. 338 election requires the adoption of the old target corporation's tax year by the new target corporation.
• C)Tax attributes of the target corporation are not lost when a Sec. 338 deemed liquidation election is made.
• D)All of the above are false.

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Definitions:

Total Assets

The combined value of everything a company owns, including cash, property, equipment, and inventory.

Total Debt

The sum of all liabilities, both current and long-term, that a company owes to creditors.

Accounts Receivable Turnover

A financial ratio that measures how efficiently a company collects receivables or the credit it extends to customers.

Average Collection Period

A financial metric that measures the average number of days it takes for a company to collect payments from its customers.