Which of the Following Statements Is True with Regard to Intercompany

question 114

Multiple Choice

Which of the following statements is true with regard to intercompany transactions?

• A)The gain or loss on an intercompany transaction is never taxed.
• B)An intercompany transaction is eliminated from consolidated taxable income.
• C)All intercompany gains are recognized, but losses must be deferred.
• D)A cash sale of a business asset by the purchasing member to an acquirer outside of the group triggers immediate recognition of the gain or loss.
• E)The gain or loss on an intercompany transaction is deferred for up to ten years, after which it is recognized.

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Definitions:

Ganglion Cells

Neurons located in the retina that process visual information and send it to the brain.

Optic Nerve

The cranial nerve that transmits visual information from the retina to the brain.

Just Noticeable Threshold

The minimum level of stimulus intensity needed for a person to detect its presence or a change in its presence, approximately 50% of the time it is present.

Physical Stimulation

Any external or internal stimulus that elicits a sensory or physiological response in the body.