Which of the Following Is True

question 15

Multiple Choice

Which of the following is true?

• A) The process of pooling mortgages or other types of loans and then selling claims or securities against that pool in a secondary market is called capitalization.
• B) Corporations pay taxes on all dividends received from other corporations, no matter their share of ownership.
• C) Corporations may pay taxes depending on their percentage of ownership.
• D) Capital gains are treated separately from ordinary corporate income for tax purposes.

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Definitions:

Total Losses

The sum of all expenses, debts, or damages that exceed gains and revenues.

Assets Test

A measure used to determine a company's financial stability by comparing its liquid assets against its liabilities.

Operating Segment

A part of a company that participates in commercial operations, generating income and bearing costs, which encompasses transactions and financial activities with other sectors of the same company.

Separate Disclosures

Financial reporting that provides detailed information separately for each significant item.