Identify Which of the Following Statements Is True

question 59

Multiple Choice

Identify which of the following statements is true.

• A)If 100% of the stock of two corporations is owned by the same individual, the two corporations are eligible to file a consolidated return.
• B)The check-the-box regulations permit partnership and LLCs to elect C corporation tax treatment.
• C)A group of corporations that meets the parent-subsidiary controlled group requirements is always eligible to file a consolidated return.
• D)All of the above are false.

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Definitions:

Paid-In Capital

Funds that shareholders contribute to a company in exchange for equity, beyond the par value of the shares.

Par Value

The face value of a stock or bond as stated by the issuing company, which does not necessarily reflect its market value.

Common Stock

A type of equity security that represents ownership in a corporation, with holders usually having voting rights and a claim on profits.

Cash Dividend

A payment made by a company out of its profits to shareholders, usually in the form of cash.