Mike Contracted with Kram Company, Mike's Controlled Corporation

question 84

Multiple Choice

Mike contracted with Kram Company, Mike's controlled corporation. Mike was a medical doctor and the contract provided that he would work exclusively for the corporation. No other doctor worked for the corporation. The corporation contracted to perform an operation for Rosa for $8,000. The corporation paid Mike $6,500 to perform the operation under the terms of his employment contract.

• A) Mike's gross income is $6,500.
• B) Mike must recognize the $8,000 gross income because he provided the service.
• C) Mike must recognize $8,000 gross income since the patient obviously wanted him to perform the operation.
• D) The Kram Company corporation's gross income is $1,500.
• E) None of these.

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Definitions:

Psychoanalytic Theory

A theory of personality organization and the dynamics of personality development that guides psychoanalysis, developed by Sigmund Freud.

Social Cognitive Theory

A theory in psychology that suggests learning occurs in a social context and can happen purely through observation or direct instruction, even in the absence of motor reproduction or direct reinforcement.

Coregulation Theory

A concept in psychology that suggests a dynamic, reciprocal relationship in emotional or behavioral regulation between individuals, such as in close relationships.

Cognitive-Developmental Theory

A theory of the stages through which children's cognitive abilities develop, originally proposed by Jean Piaget, highlighting the importance of mental processes in understanding the world.