Identify Which of the Following Statements Is True

question 39

Multiple Choice

Identify which of the following statements is true.

• A)The distribution of preferred stock as a stock dividend will result in income or a taxable gain being recognized by the shareholder on the date of the distribution if the stock is Sec. 306 stock.
• B)Corporations without E&P can distribute preferred stock as a stock dividend that is Sec. 306 stock.
• C)Two corporations are considered to be brother-sister corporations for purposes of the Sec. 304 redemption rules if one shareholder owns more than 50% of each corporation.
• D)All of the above are false.

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Definitions:

Morpheme

The smallest significant unit of meaning in a word (e.g., the word boys has two morphemes, boy and -s).

Phoneme

The smallest significant unit of sound in a language. Alphabetic characters roughly correspond to phonemes (e.g., apt, tap, and pat are all made up of the same phonemes).

Hierarchical Structure

An organizational structure where entities are ranked one above the other based on their level of authority or importance.

Phonemes

The smallest units of sound in a language that are capable of conveying a distinct meaning.