Which of the Following Statements Is Correct

question 42

Multiple Choice

Which of the following statements is correct?

• A) The LIFO recapture tax precludes an S corporation from using the LIFO method.
• B) The LIFO recapture tax is paid in five annual installments.
• C) The LIFO recapture amount increases the corporation's adjusted basis in its inventory.
• D)The LIFO recapture tax does not apply to S corporations with no earnings and profits from prior C corporation years.
• E)None of these

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