A Liquidating Corporation

question 17

Multiple Choice

A liquidating corporation

• A)recognizes gains and losses on the distribution of property.
• B)never recognizes gains and losses on the distribution of property.
• C)recognizes gains and losses only on the distribution of the specific property contributed in a Sec.351 transaction.
• D)recognizes gains,but not losses,on the distribution of property.

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Definitions:

Special Meetings

Gatherings or assemblies called for a specific purpose, outside of the regular schedule, often necessitated by urgent or unique business needs.

Notice

Formal communication or an announcement regarding a particular legal process or requirement that needs to be acknowledged or adhered to.

Business Judgment Rule

A legal principle that protects corporate directors and officers from liability for decisions made in good faith and in the best interests of the corporation.

Fiduciary Duty

A legal obligation of one party to act in the best interest of another when entrusted with care of their assets or interests.