If Annie and Andy (Each a 30% Shareholder in an S

question 101

Multiple Choice

If Annie and Andy (each a 30% shareholder in an S corporation) file a revocation on March 18, 2016 to terminate their S corporation's S election, what is the effective date of the S corporation termination (assuming they do not specify one) ?

• A) January 1, 2016.
• B) March 18, 2016.
• C) January 1, 2017.
• D)March 16, 2017.
• E)None of these

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Definitions:

Accumulated Depreciation

The total amount of depreciation expense that has been recorded for an asset since it was acquired, reflecting its loss of value over time.

Historical Cost

is the original monetary value of an asset or investment at the time of its acquisition, without adjustments for inflation or market fluctuations.

Common-Size Balance Sheet

A financial statement that presents all items as percentages of a common base figure rather than absolute numerical figures, facilitating comparison.

Shareholders' Equity

The residual interest in the assets of a corporation that remains after deducting liabilities, representing the ownership interest of shareholders.