An S Corporation Reports a Recognized Built-In Gain of $110,000

question 122

Multiple Choice

An S corporation reports a recognized built-in gain of $110,000 and taxable income of $98,000.The company has an $8,000 NOL carryforward from a C corporation year, and a $7,000 business credit carryforward from a C corporation year.The built-in gains tax liability is:

• A)$31,500.
• B)$28,700.
• C)$24,500.
• D)$0.