Mock Corporation Converts to S Corporation Status in 2020

question 9

Multiple Choice

Mock Corporation converts to S corporation status in 2020. Mock used the LIFO inventory method in 2019 and had a LIFO inventory of $435,000 (FIFO value of $550,000) on the date of the S election. How much tax must be added to Mock's 2019 corporate tax liability, assuming that Mock is subject to a 21% tax rate.

• A) $-0-
• B) $6,038
• C) $24,150
• D) $115,000