Which of the Following Statements Regarding the Tax Burden Imposed

question 8

Multiple Choice

Which of the following statements regarding the tax burden imposed on business entities is true?

• A) The tax burden imposed on corporate earnings is always lower if the corporation makes an S election.
• B) Business owners desiring current cash flow can maximize annual after-tax cash flow by operating as a regular corporation.
• C) Current tax cost associated with shareholder cash flow received as dividends may be lower than cash flow received as payments of salary, interest, or rental income.
• D) All of these statements are true.