Identify Which of the Following Statements Is True

question 39

Multiple Choice

Identify which of the following statements is true.

• A)The distribution of preferred stock as a stock dividend will result in income or a taxable gain being recognized by the shareholder on the date of the distribution if the stock is Sec. 306 stock.
• B)Corporations without E&P can distribute preferred stock as a stock dividend that is Sec. 306 stock.
• C)Two corporations are considered to be brother-sister corporations for purposes of the Sec. 304 redemption rules if one shareholder owns more than 50% of each corporation.
• D)All of the above are false.

---

Definitions:

Balance Carried

The amount of money or value transferred from the end of one financial statement or period to the beginning of another.

Adjusted Cash Balance

The cash balance resulting after certain adjustments are made, such as for outstanding checks or deposits in transit.

Check Register

A record book or ledger that tracks all checks written, deposits made, and current balance of a checking account, aiding in personal financial management.

Bank Statement

A document provided by a bank that summarizes an account's transactions and balances over a specified period.