A Calendar Year C Corporation Reports a $41,000 NOL in 2014,but

question 140

Multiple Choice

A calendar year C corporation reports a $41,000 NOL in 2014,but it elects S status for 2015 and generates an NOL of $30,000 in that year.At all times during 2015,the stock of the corporation was owned by the same 10 shareholders,each of whom owned 10% of the stock.Kris,one of the 10 shareholders,holds an S stock basis of $2,300 at the beginning of 2015.How much of the 2015 loss,if any,is deductible by Kris?

• A)$0
• B)$2,300
• C)$3,000
• D)$7,100

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Definitions:

Lucent Technologies

A former telecom giant known for its innovations in telecommunications and networking equipment, eventually merged with Alcatel.

Hawthorne Effect

A phenomenon where individuals modify an aspect of their behavior in response to their awareness of being observed.

Manager

A person responsible for controlling or administering an organization or group of staff.

Human Relations

The field of study that examines how communication and relationships between individuals and groups affect organizational behavior and performance.