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NEW QUESTION: 1
A. Option B
B. Option A
C. Option D
D. Option C
NEW QUESTION: 2
Elm Corp. is an accrual-basis calendar-year C corporation with 100,000 shares of voting common stock
issued and outstanding as of December 28, 1996. On Friday, December 29, 1996, Hall surrendered 2,000
shares of Elm stock to Elm in exchange for $33,000 cash. Hall had no direct or indirect interest in Elm
after the stock surrender. Additional information follows:
What amount of income did Hall recognize from the stock surrender?
A. $25,000 dividend.
B. $18,000 capital gain.
C. $33,000 dividend.
D. $17,000 capital gain.
Choice "d" is correct. $17,000 capital gain.
Choices "a" and "b" are incorrect. Dividends are distributions of earnings. These proceeds are from the
sale of stock.
Choice "c" is incorrect, per above. Accumulated earnings and profits do not effect the gain calculation,
they only affect the taxability of dividends paid to shareholders.
NEW QUESTION: 3
A. Option B
B. Option A
C. Option D
D. Option E
E. Option C
NEW QUESTION: 4
They are all examples of resource exhaustion
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