WGU D557 COORPORATE TAXATION PRE
ASSESSMENT EXAM WITH CORRECT ACTUAL
QUESTIONS AND CORRECTLY WELL DEFINED
ANSWERS LATEST ALREADY GRADED A+
Terms in this set (60)
An S Corporation forgoes it "S" 3. Its shareholders will no longer be eligible for
status and becomes a "C" deductions for qualified business income.
Corporation.
What is the tax consequence of this
change on the shareholders of the
corporation?
1. Its shareholders will no longer
pay self-employment tax on their
allocated income.
2. Its shareholders will no longer
pay any taxes on distributions made
by the corporation.
3. Its shareholders will no longer be
eligible for deductions for qualified
business income.
4. Its shareholders will no longer be
eligible for dividend received
deduction for any receipt of
distribution.
,A group of general partners 1. They will not pay self-employment taxes on
operating a successful general their share of the profits
partnership business is considering
forming a C Corporation.
What tax consequence should be
considered by owners of a general
partnership wanting to change to a
C Corporation?
1. They will not pay self-employment
taxes on their share of the profits.
2. They will not have to pay
separate entity-level income tax.
3. Their remunerations from the
corporations will not be subject to
payroll taxes.
4. Their receipt of distributions from
the corporation is not subject to
separate tax.
,What must a sole proprietor 2. A C Corporation is subject to corporate
consider before converting their income tax, while a single member LLC is
business to either a C Corporation regarded as a sole proprietorship for tax
or a single member LLC? purposes.
1. Both a C corporation and a
single-member LLC are taxed at the
corporate level at different tax
rates.
2. A C corporation is subject to
corporate income tax, while a
single-member LLC is regarded as a
sole proprietorship for tax
purposes.
3. Both a C corporation and a
single-member LLC are taxed at the
corporate level at a flat tax rate.
4. A C corporation is subject to
corporate income tax, while a
single-member LLC is treated as a
regular corporation for tax
purposes.
, Which business type is treated as a 1. Publicly Traded Partnership
corporation for tax purposes?
1. Publicly traded partnership
2.Limited liability company with sole
ownership
3. General partnership
4. Limited liability company with
multiple owners
A C Corp is considering issuing 4. The entire collection of $350,000 will not be
10,000 additional shares of stock to taxed in the hands of the corporation for raising
finance its expansion. The par value capital.
of one share is $1, and the market
value of one share is $35. The
company is able to raise capital of
$350,000 for these shares.
What is the tax implication for the
corporation raising capital via
additional shares?
1. The premium amount of $340,000
will be added to the corporation's
gross income.
2. The premium amount of $340,000
will be taxed separately as a capital
gain.
3. The entire collection of $350,000
will be added to the corporation's
gross income.
4. The entire collection of $350,000
will not be taxed in the hands of the
corporation for raising capital.
ASSESSMENT EXAM WITH CORRECT ACTUAL
QUESTIONS AND CORRECTLY WELL DEFINED
ANSWERS LATEST ALREADY GRADED A+
Terms in this set (60)
An S Corporation forgoes it "S" 3. Its shareholders will no longer be eligible for
status and becomes a "C" deductions for qualified business income.
Corporation.
What is the tax consequence of this
change on the shareholders of the
corporation?
1. Its shareholders will no longer
pay self-employment tax on their
allocated income.
2. Its shareholders will no longer
pay any taxes on distributions made
by the corporation.
3. Its shareholders will no longer be
eligible for deductions for qualified
business income.
4. Its shareholders will no longer be
eligible for dividend received
deduction for any receipt of
distribution.
,A group of general partners 1. They will not pay self-employment taxes on
operating a successful general their share of the profits
partnership business is considering
forming a C Corporation.
What tax consequence should be
considered by owners of a general
partnership wanting to change to a
C Corporation?
1. They will not pay self-employment
taxes on their share of the profits.
2. They will not have to pay
separate entity-level income tax.
3. Their remunerations from the
corporations will not be subject to
payroll taxes.
4. Their receipt of distributions from
the corporation is not subject to
separate tax.
,What must a sole proprietor 2. A C Corporation is subject to corporate
consider before converting their income tax, while a single member LLC is
business to either a C Corporation regarded as a sole proprietorship for tax
or a single member LLC? purposes.
1. Both a C corporation and a
single-member LLC are taxed at the
corporate level at different tax
rates.
2. A C corporation is subject to
corporate income tax, while a
single-member LLC is regarded as a
sole proprietorship for tax
purposes.
3. Both a C corporation and a
single-member LLC are taxed at the
corporate level at a flat tax rate.
4. A C corporation is subject to
corporate income tax, while a
single-member LLC is treated as a
regular corporation for tax
purposes.
, Which business type is treated as a 1. Publicly Traded Partnership
corporation for tax purposes?
1. Publicly traded partnership
2.Limited liability company with sole
ownership
3. General partnership
4. Limited liability company with
multiple owners
A C Corp is considering issuing 4. The entire collection of $350,000 will not be
10,000 additional shares of stock to taxed in the hands of the corporation for raising
finance its expansion. The par value capital.
of one share is $1, and the market
value of one share is $35. The
company is able to raise capital of
$350,000 for these shares.
What is the tax implication for the
corporation raising capital via
additional shares?
1. The premium amount of $340,000
will be added to the corporation's
gross income.
2. The premium amount of $340,000
will be taxed separately as a capital
gain.
3. The entire collection of $350,000
will be added to the corporation's
gross income.
4. The entire collection of $350,000
will not be taxed in the hands of the
corporation for raising capital.
