Which of the Following Scenarios Would Be Appropriate for a Section

question 1

Multiple Choice

Which of the following scenarios would be appropriate for a section 85 rollover?

• A)A shareholder of a corporation wishes to transfer his vehicle to his corporation.The vehicle originally cost $20,000 and has a market value of $12,000.
• B)A corporation wishes to convert land owned by the company into a parking lot.
• C)A taxpayer wishes to transfer property worth $200,000, with an ACB of $90,000, to her corporation.
• D)A corporation is selling its equipment to another corporation and does not wish to own shares in the other corporation.

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Definitions:

Lowball Technique

A persuasive tactic in which an initially favorable offer is made, but then terms are changed to be less favorable once initial commitment is achieved.

Reciprocity Norm

A social norm that expects individuals to respond to each other in kind, favoring actions that have been beneficial to them.

Fact Sheet

A concise presentation of key information, data, and statistics on a specific subject, often arranged for quick reference.

Prejudice

Preconceived opinion not based on reason or actual experience, often directed towards people or groups.