The Polaris S Corporation Has Operating Income of $50,000

question 51

Multiple Choice

The Polaris S Corporation has operating income of $50,000. Andrew is the sole shareholder of the corporation that has had the S election in effect since its inception. At the beginning of the current year, Andrew's basis in his S corporation stock is $2,000. During the year Andrew receives cash distributions totaling $55,000. How much income must Andrew recognize for the current tax year?

• A)$50,000 ordinary income; $55,000 dividend income.
• B)$50,000 ordinary income.
• C)$50,000 ordinary income; $3,000 capital gain.
• D)$55,000 dividend income; $3,000 capital gain.
• E)$55,000 dividend income.

---

Definitions:

Disparities

Differences or inequalities that are often found between segments of the population, such as health, wealth, or opportunities.

Cultural Competence

Process in which the health care professional continually strives to achieve the ability and availability to work effectively with individuals, families, and communities.

Multicultural Context

A setting or situation that involves the presence and interaction of people from diverse cultural backgrounds.

Rapport

A positive relationship characterized by mutual respect, trust, and understanding between two or more parties.