Agnes Is the Sole Shareholder of Violet,Inc

question 10

Multiple Choice

Agnes is the sole shareholder of Violet,Inc.For 2011,she receives from Violet a salary of $200,000 and dividends of $100,000.Violet's taxable income for 2011 is $500,000.On audit,the IRS treats $50,000 of Agnes's salary as unreasonable.Which of the following statements is correct?

• A) Agnes's gross income will increase by $50,000 as a result of the IRS adjustment.
• B) Violet's taxable income will not be affected by the IRS adjustment.
• C) Agnes's gross income will decrease by $50,000 as a result of the IRS adjustment.
• D) Violet's taxable income will increase by $50,000 as a result of the IRS adjustment.
• E) None of the above is correct.

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Definitions:

Socially Constructed

A concept or perception that exists because of collective agreement or social acceptance, not because of inherent natural qualities.

Sexual Identity

An individual's conception of themselves in relation to sexual attraction, behaviors, and orientation, forming a component of one's overall identity.

Queer Theory

is an interdisciplinary field of study that focuses on the exploration of sexual orientation and gender identity, challenging traditional norms and categories.

Sexual Boundaries

Refer to the limits and rules that individuals establish for themselves and others regarding sexual behavior and interactions.