A Calendar-Year Corporation Has Negative Current E&P of $500 and Accumulated

question 87

Multiple Choice

A calendar-year corporation has negative current E&P of $500 and accumulated positive E&P of $1,000. The corporation makes a $600 distribution to its sole shareholder. Which of the following statements is True?

• A) $500 of the distribution will be a dividend because total earnings and profits is $500.
• B) $0 of the distribution will be a dividend because current earnings and profits are negative.
• C) $600 of the distribution will be a dividend because accumulated earnings and profits is $1,000.
• D) Up to $600 of the distribution could be a dividend depending on the balance in accumulated earnings and profits on the date of the distribution.

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Definitions:

SQL View

A virtual table created by a query applied to one or more tables in a database, providing a specific view of the data for user queries or data management.

Is Null

A condition or statement in databases that checks if a value is absent or empty.

Date/Time

A data type in programming and database management that represents a specific date and time of an event, entry, or transaction.

Table Design View

A feature in database applications allowing users to define and modify the structure, fields, and properties of a database table.