Identify Which of the Following Statements Is False

question 58

Multiple Choice

Identify which of the following statements is false.

• A)The acquiescence policy was adopted by the U.S. Tax Court to permit litigating parties to agree on the exact amount of the tax due.
• B)Letter rulings are binding only with respect to the taxpayer requesting the ruling.
• C)The small cases procedure of the U.S. Tax Court allows a less formal hearing but provides for no appeal.
• D)The IRS may retroactively revoke an acquiescence.

---

Definitions:

Price-Earnings Ratio

A valuation metric for stocks, calculated by dividing the market price of a stock by its earnings per share, indicating the dollar amount an investor can expect to invest in a company to receive one dollar of that company’s earnings.

Common Stock

Equity ownership in a corporation, with shareholders entitled to vote on corporate matters and receive dividends when declared.

Market Price

The present cost at which a product or service can be purchased or sold on the market.

Return on Total Assets

A measure of profitability that indicates how efficiently a company is using its assets to generate earnings.