Which of the Following Is Least Likely to Result in a Constructive

question 1696

Multiple Choice

Which of the following is least likely to result in a constructive dividend?

• A) an unreasonable salary paid to a shareholder
• B) a payment by a corporation of a shareholder's personal expenses
• C) a payment by a corporation of a shareholder's debts
• D) a sale of a corporation's asset to a shareholder at fair market value

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Definitions:

Last-In, First-Out

An inventory valuation method that assumes the items most recently purchased or produced are sold first, leaving older inventory in stock.

Merchandise Sold

Merchandise sold refers to the products that a company sells to its customers, which can include anything from physical goods to software.

Purchases Made

Transactions involving the acquisition of goods or services by a company for the purpose of resale or for use in production.

Physical Count of Inventory

An actual count of all merchandise or stock on hand, typically conducted at the end of an accounting period to verify inventory records.