Required information Problem 11-47 (LO 11-2) (Algo) [The following information applies to the questions displayed below.] Assume the following S corporations, gross receipts, passive investment income, and corporate E&P. Will any of these corporations have its S election terminated due to excessive passive income? If so, in what year? All became S corporations at the beginning of year 1. (Leave no answer blank. Select "NA" if no effect.)

Required information Problem 11-47 (LO 11-2) (Algo) [The following information applies to the questions displayed below.] Assume the following S corporations, gross receipts, passive investment income, and corporate E&P. Will any of these corporations have its S election terminated due to excessive passive income? If so, in what year? All became S corporations at the beginning of year 1. (Leave no answer blank. Select "NA" if no effect.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Cc.44.
In appropriate situations the IRS may assert That the Corporation be disregarded as a sham or nominee That income reported by the Corporation belongs on the shareholder’s personal Form 1040 Schedule C under the assignment of income principles. Income is reallocated under §482 to unrelated organizations Tax benefits may be denied under §269 if control of a Corporation is acquired for a purpose of avoiding federal income tax. All of the above All of the above except C All of the above except D All of the above except C & D
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True/False. In their Articles of Incorporation, corporations that want to maintain flexibility about future business ventures they might engage in often state a very generic corporate purpose (e.g., “engage in any activity that is lawful for domestic corporations”) or do not include a purpose at all if listing a purpose is optional.