Which Statement Is Correct with Respect to Filing an S

question 101

Multiple Choice

Which statement is correct with respect to filing an S election?

• A)Form 2553 must be filed.
• B)All shareholders must consent.
• C)The election may be filed in the previous year.
• D)An extension of time is available for filing Form 2553.
• E)All of the above statements are correct.

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Definitions:

Year-end Information

Data or records summarizing the financial activities and status of an organization at the end of a fiscal year.

Acid-test Ratio

A financial metric that assesses a company's ability to pay its current liabilities with its most liquid assets.

Liquidity Problems

Financial difficulties arising from an entity's inability to quickly convert assets into cash without significant loss, impacting its capacity to meet short-term obligations.

Acid-test Ratio

A stringent indicator that determines whether a firm has enough short-term assets to cover its immediate liabilities without selling inventory.