Identify Which of the Following Statements Is True

question 80

Multiple Choice

Identify which of the following statements is true.

• A)Able Corporation (New York)transfers its assets to Able Corporation (Delaware)in exchange for all of its stock. Able Corporation (New York)is liquidated. This exchange is a Type F reorganization.
• B)Strict adherence to legislative guidelines with regard to reorganizations is sufficient for tax-free treatment.
• C)A suitable business purpose for a tax-free reorganization is to permit the minimization of shareholder taxes.
• D)All of the above are false.

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Definitions:

Spontaneous Contraction

Involuntary and automatic contraction of muscles, often referring to the muscles in various organs such as the heart.

Skeletal Muscle

A type of striated muscle attached to the skeleton that facilitates movement through contraction.

Smooth Muscle

A type of muscle tissue which is not under voluntary control and is found in the walls of internal organs.

Cardiac Muscle

A specialized type of muscle found only in the heart, characterized by its ability to contract involuntarily and rhythmically.