Which of the Following Statements Is Correct

question 97

Multiple Choice

Which of the following statements is correct?

• A) A C corporation classified as a small corporation is eligible to have the AMT calculated using the AMT provisions for individuals.
• B) A C corporation classified as a small corporation is not subject to the AMT.
• C) A C corporation classified as a small corporation is subject to the AMT only on its adjusted current earnings.
• D) A C corporation classified as a small corporation is eligible to use the 20%/15%/0% tax rate on net capital gain and qualified dividends rather than the regular tax rates applicable to other C corporations.
• E) a., b., and c. are correct.

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Definitions:

Operating Plan

A detailed outline of a company's goals, strategies, and projected financial actions within a specific period, usually part of the overall business plan.

Planning Assumption

An assumption about the future on which a business plan is based. The assumption must be reflected in the firm’s financial projections by calculating the specific financial statement figures it implies.

Financial Statement

A formal record of the financial activities and position of a business, person, or other entity, typically detailed in an income statement, a balance sheet, and a statement of cash flows.

Strategic Plans

Long-term, forward-looking approaches and plans created by organizations to achieve major goals and objectives.