Identify Which of the Following Statements Is True

question 69

Multiple Choice

Identify which of the following statements is true.

• A) An S corporation shareholder can increase the adjusted basis of his/her stock by any indebtedness owed the shareholder by the S corporation.
• B) The overall S corporation loss limitation equals the shareholder's adjusted basis for his/her S corporation stock plus his/her ratable share of all S corporation liabilities.
• C) The loss pass- throughs from an S corporation may produce a net operating loss for the shareholder.
• D) All of the above are false.

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Definitions:

Concrete Operations Stage

Piaget’s third stage of cognitive development, in which the school-age child becomes capable of logical thought processes but is not yet capable of abstract thinking.

Logical Thinking

The process of using rational, systematic steps based on sound reasoning to arrive at a conclusion.

Abstract Thinking

The cognitive ability to understand concepts that are not based on physical reality but rather on ideas or qualities.

Pregnant Women

Refers to females who are in the process of carrying a developing embryo or fetus within their uterus.