Purple Corporation Has Accumulated E & P of $100,000 on January

question 170

Multiple Choice

Purple Corporation has accumulated E & P of $100,000 on January 1,2017.In 2017,Purple has current E & P of $130,000 (before any distribution) .On December 31,2017,the corporation distributes $250,000 to its sole shareholder,Cindy (an individual) .Purple Corporation's E & P as of January 1,2018 is:

• A)$0.
• B)($20,000).
• C)$100,000.
• D)$130,000.
• E)None of the above.

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Definitions:

Natural Monopolist

A single provider of a good or service in a market, where the nature of the product or service makes competition impractical due to high infrastructure or start-up costs.

Regulatory Commission

A governmental body responsible for enforcing specific regulations and overseeing the practices within certain industries.

Economic Profit

A financial gain that exceeds both the explicit and implicit costs associated with business operations.

Natural Monopolist

A firm that can supply the entire market at a lower cost than any combination of two or more smaller firms, often due to economies of scale.