Identify Which of the Following Statements Is True

question 72

Multiple Choice

Identify which of the following statements is true.

• A) The target corporation's tax attributes are lost in a Type B reorganization.
• B) A Type B reorganization can be accomplished without formal shareholder approval.
• C) Ann, Dewey Corporation's sole shareholder, exchanges her Dewey stock having a $400,000 FMV and a $175,000 adjusted basis for $350,000 of Heider Corporation stock and $50,000 cash. Ann realizes a $225,000 gain on the stock transfer, none of which is recognized.
• D) All of the above are false.

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Definitions:

Judgment

The skill to arrive at well-thought-out decisions or logical conclusions.

Conflict

A situation or issue characterized by disagreement, opposition, or clash between two or more parties.

Risk Averse

Characteristic of individuals or entities that prefer to avoid risks and opt for safer options when making decisions.

Loss Averse

A cognitive bias that describes why for individuals the pain of losing is psychologically about twice as powerful as the pleasure of gaining.