Question 1

An S corporation with substantial AEP records operating revenues of $410,000, taxable interest income of $390,000, operating expenses of $260,000, and deductions attributable to the interest of $150,000.The passive income penalty tax payable is:

Accepted Answer

A)  $0.
B)  $40,923.
C)  $116,923.
D)  $136,500.E) None of the above
F) B) and C)

Question 2

Samantha owned 1,000 shares in Evita, Inc., an S corporation, that uses the calendar year.On October 11, Samantha sells all of her Evita stock.Her stock basis at the beginning of the tax year was $60,000.Evita's ordinary income for the year was $22,000, and she receives a distribution of $35,000 on May 3rd.Her stock basis at the time of the sale is:

Accepted Answer

A)  $117,000.
B)  $82,000.
C)  $60,000.
D)  $47,000.E) A) and B)
F) B) and C)

Question 3

The Section 179 expense deduction is a Schedule K item on the Form 1120S.

Accepted Answer

A) True 
 B)False

Question 4

A per-day, per-share allocation of flow-through S corporation items must be used, unless the shareholder disposes of the entire interest in the entity.

Accepted Answer

A) True 
 B)False

Question 5

​A distribution from the other adjustment account (OAA) is not taxable to an S shareholder.

Accepted Answer

A) True 
 B)False

Question 6

Compare the distribution of property rules for an S corporation with the corresponding partnership rules.

Accepted Answer

The major difference involves distributi...

Question 7

Which item has no effect on an S corporation's AAA?

Accepted Answer

A)  Stock purchase by a shareholder.
B)  Interest expense.
C)  Cost of goods sold.
D)  Capital loss.E) A) and C)
F) B) and D)

Question 8

If any entity electing S status is currently a C corporation, NOL carryovers from prior years ____________________ be used in an S corporation year.

Accepted Answer

The answer of If any entity electing S status is...

Exam 15: S Corporations

The Section 179 expense deduction is a Schedule K item on the Form 1120S.

Correct Answer
verified

A distribution from the other adjustment account (OAA) is not taxable to an S shareholder.

Correct Answer
verified

Which item has no effect on an S corporation's AAA?

Correct Answer
verified

A per-day, per-share allocation of flow-through S corporation items must be used, unless the shareholder disposes of the entire interest in the entity.

Correct Answer
verified

If any entity electing S status is currently a C corporation, NOL carryovers from prior years ____________________ be used in an S corporation year.

Correct Answer
verified

Compare the distribution of property rules for an S corporation with the corresponding partnership rules.

Correct Answer
verified
The major difference involves distributi...
View Answer

Correct Answer
verified

An S corporation with substantial AEP records operating revenues of $410,000, taxable interest income of $390,000, operating expenses of $260,000, and deductions attributable to the interest of $150,000.The passive income penalty tax payable is:

Correct Answer
verified

Exam 15: S Corporations

The Section 179 expense deduction is a Schedule K item on the Form 1120S.

Correct AnswerverifiedShow Answer

​A distribution from the other adjustment account (OAA) is not taxable to an S shareholder.

Correct AnswerverifiedShow Answer

Which item has no effect on an S corporation's AAA?

Correct AnswerverifiedShow Answer

A per-day, per-share allocation of flow-through S corporation items must be used, unless the shareholder disposes of the entire interest in the entity.

Correct AnswerverifiedShow Answer

If any entity electing S status is currently a C corporation, NOL carryovers from prior years ____________________ be used in an S corporation year.

Correct AnswerverifiedShow Answer

Compare the distribution of property rules for an S corporation with the corresponding partnership rules.

Correct AnswerverifiedThe major difference involves distributi...View AnswerShow Answer

Correct AnswerverifiedShow Answer

An S corporation with substantial AEP records operating revenues of $410,000, taxable interest income of $390,000, operating expenses of $260,000, and deductions attributable to the interest of $150,000.The passive income penalty tax payable is:

Correct AnswerverifiedShow Answer

Correct Answer
verified

A distribution from the other adjustment account (OAA) is not taxable to an S shareholder.

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The major difference involves distributi...
View Answer

Correct Answer
verified

Correct Answer
verified