[New Agency] Ruth Just Got a Job as an Assistant

question 25

Multiple Choice

[New Agency] Ruth just got a job as an assistant in a new federal agency called the Accounting Commission, which was set up to regulate the accounting and auditing profession. The agency is headed by commissioners who serve for fixed terms and can be removed only for cause. No more than a majority of the commissioners may be from the same political party. The agency is getting ready to issue rules. The enabling legislation that set up the Accounting Commission specified that the agency could make rules but said nothing about the form of the rules. Ruth's boss, Odette, gave her some proposed rules and asked her to be sure that they were published and to take care of the next step in the approval process. Odette also told her that at this point she was not very interested in hybrid rule making.
-Which of the following is the most likely type of rulemaking that Ruth will propose?

• A) Informal
• B) Formal
• C) Legislative
• D) Regulatory
• E) Procedural

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Definitions:

Form 1120

The U.S. Corporate Income Tax Return, a form used by corporations to report their income, gains, losses, deductions, and credits to the IRS.

C Corporations

A type of business entity that is taxed separately from its owners, providing limited liability to its shareholders.

Tax Returns

Formal documents filed with tax authorities that report income, expenses, and other pertinent tax information.

Corporate Distributions

Payments made by a corporation to its shareholders from its earnings.