Which of the Following Statements Best Describes the Role of Current

question 91

Multiple Choice

Which of the following statements best describes the role of current and accumulated earnings and profits in determining if at least a portion of a distribution is a dividend?

• A)A distribution will be a dividend only to the extent total earnings and profits (current plus accumulated)is positive at the time of the distribution.
• B)No part of a distribution will be a dividend if current earnings and profits is negative.
• C)A distribution will be at least in part a dividend if current earnings and profits for the year is positive, even if accumulated earnings and profits is negative.
• D)No part of a distribution will be a dividend if current earnings and profits for the year is negative, even if accumulated earnings and profits is positive.

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Definitions:

Federal Government

The national government of a federal country, in which powers are divided between a central authority and constituent political units.

Infant Mortality Rates

The statistical measure of the number of deaths of infants under one year of age per 1,000 live births in a given year.

Life Expectancies

The average period that an individual is expected to live, based on statistical averages of age-specific death rates.

Insurance Coverage

The extent and type of protection provided by an insurance policy against risks, including healthcare costs, loss, or damage.