Which of the Following Statements Is Incorrect

question 48

Multiple Choice

Which of the following statements is incorrect?

• A)A corporation can choose the fiscal year-end of its choice when it files its first tax return without approval of the IRS.
• B)A corporation with average annual gross receipts of $10 million must use the accrual basis of accounting.
• C)A calendar year corporation must file its tax return no later than March 15 of the following year.
• D)C corporations must annually file a Form 1120 tax return.

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Definitions:

Average Rate of Return

A financial metric used to evaluate the profitability of an investment, calculated as the average annual profit divided by the initial investment cost.

Residual Value

The estimated value that an asset will realize upon its disposal at the end of its useful life.

Useful Life

The estimated period over which a fixed asset is expected to be usable by a company, beyond which it is considered to depreciate.

Average Rate of Return

A financial ratio that calculates the average annual return an investor can expect over the lifetime of an investment, expressed as a percentage of the original investment.