Principles of Taxation

Business

Quiz 11 :

The Corporate Taxpayer

Quiz 11 :

The Corporate Taxpayer

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In terms of dispersal of ownership,corporations are classified as either closely held or publicly held.
Free
True False
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True

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The four primary legal characteristics of a corporation are unlimited liability,limited life,free transferability of interests,and centralized management.
Free
True False
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False

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Eagle,Inc.made a contribution to the Boy Scouts of $25,000 during its current tax year.The corporation's taxable income before any charitable contribution deduction was $200,000.The corporation has a current charitable contribution deduction of $25,000.
Free
True False
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False

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A nondeductible charitable contribution is a permanent book/tax difference.
True False
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Donatoni Corporation owns 40% of Market,Inc.voting common stock.During the current year,Donatoni received a $30,000 dividend from Market.Donatoni must report the dividend as gross income,and is allowed a $15,000 dividends-received deduction.
True False
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The dividends-received deduction is equal to 65% of any dividends-received by a corporate taxpayer.
True False
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Corporations are allowed a deduction for charitable contributions,limited to 10 percent of taxable income before the deduction.
True False
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The federal tax law considers the member corporations of an affiliated group to be a single entity for federal tax purposes.
True False
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After 2017,a 1.4% excise tax applies to the net investment income of all colleges and universities.
True False
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A nonprofit corporation may incur a federal income tax if it has unrelated business income.
True False
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The corporate characteristic of free transferability exists if the corporate stock is subject to a buy-sell agreement.
True False
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For distributions prior to 2018,dividends-received deductions generally are not allowed for dividends from foreign corporations.
True False
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Rogers,Inc.owns 12% of Lampe Corporation's voting common stock.During the current year,Rogers generated $50,000 operating income and received $8,000 dividends from Lampe.Only $2,800 of the dividend is taxable.
True False
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At least three corporations are required to form an affiliated group.
True False
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The corporate characteristic of limited liability is generally more important to the shareholders than the characteristic of centralized management.
True False
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Bisou Inc.made a $48,200 contribution to charity this year.Only $39,000 of the contribution was deductible.Bisou can carry the $9,200 nondeductible contribution back three years and forward five years.
True False
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The stock of closely held corporations is typically restricted as to transferability by some type of buy-sell agreement and cannot be sold on the open market.
True False
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After 2017,a 37% excise tax applies to compensation in excess of $1 million paid to executives of tax-exempt organizations.
True False
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After 2017,a 100% dividends-received deduction is permitted for any dividends received from a foreign corporation.
True False
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An affiliated group consists of a parent company that directly owns 80% of at least one subsidiary corporation plus all other subsidiaries that are 80% owned within the group.
True False
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