Serenity Receives a Nonliquidating Distribution from the Hickock Corporation, an S

question 54

Multiple Choice

Serenity receives a nonliquidating distribution from the Hickock Corporation, an S corporation. Which of the following statements concerning nonliquidating distributions from an S corporation are correct?
I.A nonliquidating cash distribution is taxable if the amount distributed exceeds Serenity's basis in Hickock.
II.The amount of the dividend on a nonliquidating distribution of property is the fair market value of the property distributed.
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• A)Only statement I is correct.
• B)Only statement II is correct.
• C)Both statements are correct.
• D)Neither statement is correct.

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Definitions:

Exclusive Representation

A situation where a single entity, such as a union, is authorized to represent and negotiate on behalf of all employees in a particular bargaining unit.

Majority Support

The condition where more than half of a group or constituency expresses approval or endorsement of a proposition or representative.

Culture

The customs, social behavior, and norms found in human societies.

NLRA

The National Labor Relations Act, a foundational statute in United States labor law that protects the rights of employees to organize, engage in collective bargaining, and participate in concerted activities for mutual aid or protection.