Which of the Following Statements About the Outcome of an IRS

question 28

Multiple Choice

Which of the following statements about the outcome of an IRS audit is false?

• A)The most probable outcome of an audit is that the taxpayer will be assessed a deficiency.
• B)An audit can't result in a refund of tax due to the taxpayer.
• C)If a revenue agent finds no mistakes on a return during an audit,the agent files a report concluding "no change."
• D)None of the above is false.

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Definitions:

Retained Earnings Account

An equity account that represents the accumulated portion of net income left over after dividends are paid to shareholders.

Cumulative Earnings

The total net income of a company since its inception, minus any dividends paid to shareholders.

Dividends

Distributions to shareholders from a company, typically originating from the profits earned by the corporation.

Current Market Value

refers to the amount at which an asset or security could be bought or sold in a current transaction between willing parties.