Duck Corporation Is a Calendar Year Taxpayer Formed in 2005

question 22

Multiple Choice

Duck Corporation is a calendar year taxpayer formed in 2005.Duck's E & P for each of the past 5 years is listed below. Duck Corporation made the following distributions in the previous 5 years.
2009 Land (basis of $700,000,fair market value of $800,000)
2006 $200,000 cash
Duck's accumulated E & P as of January 1,2011 is:

• A) $910,000.
• B) $950,000.
• C) $1,010,000.
• D) $1,050,000.
• E) None of the above.

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Definitions:

Exempt Employee

An employee who is exempt from overtime pay and minimum wage requirements, typically based on their job duties and salary level.

FLSA

The Fair Labor Standards Act, a US labor law that sets out minimum wage, overtime pay eligibility, recordkeeping, and child labor standards for full-time and part-time workers in the private sector and in federal, state, and local governments.

Exempt Workers

Employees not covered by the Fair Labor Standards Act (FLSA), often not eligible for overtime pay due to their job type.

Promissory Estoppel

A legal principle preventing a party from retracting a promise which the other party has reasonably relied upon to their detriment.