Identify Which of the Following Statements Is True

question 32

Multiple Choice

Identify which of the following statements is true.

• A)The assignment of income doctrine requires a cash method of accounting for a transferor/shareholder to recognize income when accounts receivable are transferred by the shareholder to the corporation in a Sec. 351 exchange in which no gain is otherwise recognized.
• B)The assignment of income doctrine is a legislative requirement that income be taxed to the person who earns it.
• C)The assignment of income doctrine does not apply if the transferor in a Sec. 351 exchange in which no gain is otherwise recognized transfers when a sole proprietor transfers substantially all the assets and liabilities of the transferor's trade or business to a controlled corporation.
• D)All of the above are false.

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Definitions:

Structural Support

The physical framework provided by the skeletal structure and tissues that supports an organism or anatomical part.

Neurons

Specialized cells in the nervous system that transmit information to other nerve cells, muscle, or gland cells.

Glia

Non-neuronal cells in the nervous system that provide support and protection for neurons, playing critical roles in brain function.

Electrical Charge

A physical property of matter that causes it to experience a force when placed in an electromagnetic field.