Little CoIs a Canadian Controlled Private Corporation and Large Co

question 9

Multiple Choice

Little Co.is a Canadian controlled private corporation and Large Co.is a public Canadian corporation.Both corporations have a paid-up capital balance of $25,000.Which of these statements is TRUE, provided the proper legal steps are followed?

• A)If Little Co.makes a payment of $25,000 to its shareholders by reducing its paid-up capital, there will be no tax consequence for the shareholders.
• B)If Little Co.makes a payment of $25,000 to its shareholders by reducing its paid-up capital, only 50% of the payment will be taxable.
• C)If Large Co.makes a payment of $25,000 to its shareholders by reducing its paid-up capital, there will be no tax consequence for the shareholders.
• D)If Large Co.makes a payment of $25,000 to its shareholders by reducing its paid-up capital, only 50% of the payment will be taxable.

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Definitions:

Mission Statement

A concise description of an organization's purpose, identifying its scope of operations, and guiding its decision-making.

Profit

The financial gain that results when the amount of revenue gained from a business activity exceeds the expenses, costs, and taxes needed to sustain the activity.

Marketing Plan

A comprehensive document or blueprint outlining a business's advertising and marketing efforts for the coming period.

Mission

A statement or vision that defines the fundamental purpose of an organization, guiding its operations and goals.