Which of the Following Statements Is Incorrect

question 18

Multiple Choice

Which of the following statements is incorrect?

• A) A corporation can choose a fiscal year-end of its choice when filing its first tax return.
• B) A corporate tax return is due 2½ months after the end of the fiscal year.
• C) Corporations that own foreign subsidiaries cannot file a Form 1120.
• D)Some corporations can use the cash-basis of accounting.

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Definitions:

Fixed Costs

Costs that do not vary with the level of production or sales, such as rent, salaries, and insurance premiums.

Variable Cost

Expenses that change in proportion to the activity of a business, such as costs for raw materials that fluctuate with production volume.

Room Nights

A measure in the hospitality industry, representing the total number of nights that guests have booked to stay in a hotel.

Break-Even Point

The point at which total revenues equal total costs, resulting in neither profit nor loss.