Identify Which of the Following Statements Is False

question 36

Multiple Choice

Identify which of the following statements is false.

• A)A sale or exchange of at least 50% of the capital and profits interest in a partnership within a 12- consecutive-month period will terminate the partnership and end all of the partnership's elections.
• B)When using the 50% rule to terminate a partnership, if an interest is sold more than once during the 12-month period, each sale is counted separately.
• C)A partner's individual income tax return, under some circumstances, may include the results of partnership operations for a period exceeding 12-months.
• D)When several different transfers are made during a 12-month period, the partnership termination occurs on the date of the transfer that first crosses the 50% threshold.

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Definitions:

Opportunity Cost

The value of the next best alternative that is foregone as a result of making a particular decision.

Accounting Profits

The total revenues of a business minus the explicit costs, essentially the net income on the financial statements.

Total Revenue

The total income received by a firm from its sales of goods or services, calculated as the quantity sold multiplied by the selling price.

Barriers to Entry

Factors that prevent or hinder new competitors from easily entering an industry or area of business.