Identify Which of the Following Statements Is True

question 68

Multiple Choice

Identify which of the following statements is true.

• A)To qualify for Sec. 351 treatment, control is defined as more than 50% ownership of the voting stock, and more than 50% of all other classes of stock.
• B)If a shareholder receives stock with an FMV greater than the FMV of the property exchanged in a Sec. 351 transaction, the excess FMV may be considered a gift from one shareholder to another shareholder.
• C)Only transfers to newly created corporations qualify for Sec. 351 treatment.
• D)All of the above are false.

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Definitions:

AASB 119

An Australian Accounting Standard that specifies the accounting for employee benefits, including pensions and other post-employment benefits.

Long Service Leave

An employee benefit offering paid leave to employees who have served a particular period of time with the same employer or industry.

Legal Entitlement

The right of an individual or entity to have or do something according to the law.

Salary Sacrificing

An arrangement where an employee agrees to receive less income in return for their employer providing benefits of a similar value.