Note: This Is a Kaplan CPA Review Question

question 14

Multiple Choice

Note: This is a Kaplan CPA Review Question
The condensed balance sheet of Adams & Gray, a partnership, at December 31, 20X1, follows:
On December 31, 20X1, the fair values of the assets and liabilities were appraised at $240,000 and $20,000, respectively, by an independent appraiser. On January 2, 20X2, the partnership was incorporated and 1,000 shares of $5 par value common stock were issued. Immediately after the incorporation, what amount should the new corporation report as additional paid-in capital?

• A) $275,000
• B) $215,000
• C) $260,000
• D) $0

Explain the importance of the ability to pivot to prevent significant failures.

Comprehend the psychological and economic factors affecting entrepreneurs' reaction to failure.

Understand the concept and importance of learning from failures for entrepreneurs.

Learn about Angela Lee Duckworth's research on grit and its relevance to success.

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Definitions:

Excise Tax

A tax applied to specific goods, services, or activities, often with the intention of reducing consumptions, such as taxes on tobacco or alcohol.

Tax Incidence

The study of who ultimately bears the economic burden of a tax, whether producers or consumers.

Inelastic Demand

A situation where the demand for a product does not significantly change with a change in its price.

Excise Tax

A tax levied on the sale of particular goods and services, such as alcohol, tobacco, and gasoline.