Identify Which of the Following Statements Is True

question 47

Multiple Choice

Identify which of the following statements is true.

• A)Loans made to shareholders in proportion to their stock ownership in the corporation is evidence that the loans are disguised dividends.
• B)Corporate payments for the shareholder's benefit may be a taxable dividend.
• C)If the shareholder can elect to receive distributing corporation stock or money, the receipt of distributing corporation stock will be a taxable dividend.
• D)All of the above are true.

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Definitions:

Yield

The income return on an investment, such as the interest or dividends received, expressed as an annual percentage rate based on the investment's cost, its current market value, or its face value.

Exchange Rate

Price of a unit of one country’s currency in terms of another country’s currency.

U.K. Bills

Short-term debt instruments issued by the United Kingdom government, typically with a maturity of less than one year.

Risk-Free Rate

The theoretical return of an investment with zero risk, often represented by the yield of government bonds.