Under PL86-272, Which of the Following Transactions by Itself Would Create

question 59

Multiple Choice

Under P.L.86-272, which of the following transactions by itself would create nexus with a state?

• A)Inspection by a sales employee of the customer's inventory for specific product lines.
• B)Using an independent contractor who acts as a manufacturer's representative for the taxpayer through a sales office in the state.
• C)Executing a sales campaign, using an advertising agency acting as an independent contractor for the taxpayer.
• D)Maintenance of inventory in the state by an independent contractor under a consignment plan.

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Definitions:

Dividends

Payments made by a corporation to its shareholder members, typically from profits or reserves.

Ordinary Income

Income earned from conducting standard business operations, as opposed to capital gains or investment income.

Straight Line

In finance, often refers to a method of depreciation where an asset's value decreases evenly over its useful life.

Depreciated

The reduction in an asset's worth over a period, frequently as a result of usage or becoming outdated.