Identify Which of the Following Statements Is False

question 37

Multiple Choice

Identify which of the following statements is false.

• A) Sec. 337(a) provides that the liquidating corporation recognizes no gain or loss on the distribution of property to the 80% distributee in a complete Sec. 332 liquidation.
• B) A corporation that distributes the stock of a subsidiary may elect to treat the distribution as a sale of the subsidiary's assets.
• C) The depreciation recapture provisions in Secs. 1245 and 1250 override the Sec. 337(a) nonrecognition rule if a controlled subsidiary corporation is liquidated into its parent corporation.
• D) Liquidating distributions made to minority shareholders in the tax- free liquidation of a controlled subsidiary corporation are treated by the liquidating corporation in the same way as nonliquidating distributions.

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Definitions:

Budget Line

A graphical representation that shows all possible combinations of two goods that an individual can afford given their income and the prices of the goods.

Consumer Income

The total money earned by consumers from all sources, including wages, salaries, investments, and benefits, which impacts their purchasing power.

Price

The amount of money required to purchase a good or service, determined by factors such as supply and demand, production costs, and market competition.

Indifference Schedule

A graphical representation in economics showing different bundles of goods between which a consumer is indifferent.