Which Statement Is Incorrect with Respect to an S Shareholder's

question 44

Multiple Choice

Which statement is incorrect with respect to an S shareholder's consent?

• A)A consent extension is available only if Form 2553 is filed on a timely basis, reasonable cause is given, and the interests of the government are not jeopardized.
• B)Both husband and wife must consent if one owns the stock as community property.
• C)An S election requires a consent from all of the S corporation's shareholders.
• D)A consent must be in writing.
• E)None of the above statements is incorrect.

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Definitions:

Returns to Scale

The rate at which output changes if the scale of all inputs is changed by the same proportion.

Output Level

The amount of product or service that is produced by a company or an economy at a given time.

Isoquants

Curves representing combinations of inputs which yield the same level of output in production theory, illustrating technical substitution and factor combinations.

MRTS

Marginal Rate of Technical Substitution; the rate at which one input must increase when another input decreases to keep output constant.