Question 1

Stock basis first is increased by income items, then by distributions, and finally decreased by _.

Accepted Answer

The answer of Stock basis first is increased by income...

Question 2

You are given the following facts about a 50% owner of an S corporation.Compute her ending stock basis.

Accepted Answer

A)  $80,950.
B)  $85,750.
C)  $100,100.
D)  $106,225.E) A) and B)
F) A) and C)

Question 3

Pass-through S corporation losses can reduce the basis in the shareholder's loan to the entity, but distributions do not reduce loan basis.

Accepted Answer

A) True 
 B)False

Question 4

An S corporation can claim a deduction for its NOL amounts.

Accepted Answer

A) True 
 B)False

Question 5

Where the S corporation rules are silent, C corporation provisions apply.

Accepted Answer

A) True 
 B)False

Question 6

Lent Corporation converts to S corporation status in 2018.Lent had been using the LIFO inventory method and held a LIFO inventory value of $510,000 FIFO value of $650,000) .How much tax must be added to the C corporation tax liability for the year before the S election in 2019.

Accepted Answer

A)  $0.
B)  $7,350.
C)  $29,400.
D)  $140,000.E) B) and D)
F) All of the above

Question 7

The maximum number of actual shareholders in an S corporation is:

Accepted Answer

A)  75.
B)  100.
C)  200.
D)  Some other number.
E)  Indeterminable.F) A) and E)
G) B) and D)

Question 8

An S corporation's separately stated items generally are identical to those separately stated by
_________________________.

Accepted Answer

The answer of An S corporation's separately stated items generally...

Question 9

An S shareholder who dies during the S corporation tax year must report his or her share of the pro rata income loss) items up to the date of death, on the final individual tax return.

Accepted Answer

A) True 
 B)False

Question 10

An S corporation is limited to a theoretical maximum of shareholders.

Accepted Answer

The answer of An S corporation is limited to a...

Question 11

What statement is correct with respect to an S corporation?

Accepted Answer

A)  There is no advantage to elect § 1244 stock.
B)  An S corporation can own up to 85% of an insurance company.
C)  A resident alien may be a shareholder.
D)  A voting trust arrangement is not available.
E)  None of the above statements is true.F) A) and E)
G) B) and E)

Question 12

Some and taxation rules apply to an S corporation.

Accepted Answer

partnershi...

Question 13

A service-type S corporation shareholder cannot claim the 20% QBI deduction.

Accepted Answer

A) True 
 B)False

Question 14

An S corporation cannot incur a tax liability at the corporation level.

Accepted Answer

A) True 
 B)False

Question 15

If an S corporation has C corporation E & P and passive investment income in excess of
% of its gross receipts for consecutive taxable years, the S election is terminated at the beginning of the year.

Accepted Answer

The answer of If an S corporation has C corporation...

Question 16

NOL carryovers from C years can be used in an S corporation year against ordinary income.

Accepted Answer

A) True 
 B)False

Question 17

A capital loss allocated to a shareholder always reduces the Other Adjustments Account.

Accepted Answer

A) True 
 B)False

Question 18

An S shareholder's stock basis is reduced by flow-through losses before accounting for distributions.

Accepted Answer

A) True 
 B)False

Question 19

What method is used to allocate S corporation income or losses unless an election to the contrary is made) ?

Accepted Answer

A)  Any method agreed to by all of the shareholders.
B)  Per-day allocation.
C)  FIFO method.
D)  LIFO method.E) A) and B)
F) None of the above

Question 20

Which item does not appear on Schedule K of Form 1120S?

Accepted Answer

A)  Tax-exempt interest income.
B)  Section 1231 gain.
C)  Section 179 depreciation deduction.
D)  Depreciation recapture income.
E)  All of the above appear on Schedule K.F) A) and E)
G) None of the above

Exam 15: S Corporations

A service-type S corporation shareholder cannot claim the 20% QBI deduction.

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An S shareholder who dies during the S corporation tax year must report his or her share of the pro rata income loss) items up to the date of death, on the final individual tax return.

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Stock basis first is increased by income items, then by distributions, and finally decreased by _.

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What statement is correct with respect to an S corporation?

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An S corporation cannot incur a tax liability at the corporation level.

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Some and taxation rules apply to an S corporation.

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Lent Corporation converts to S corporation status in 2018.Lent had been using the LIFO inventory method and held a LIFO inventory value of $510,000 FIFO value of $650,000) .How much tax must be added to the C corporation tax liability for the year before the S election in 2019.

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An S corporation's separately stated items generally are identical to those separately stated by _________________________.

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An S corporation is limited to a theoretical maximum of shareholders.

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An S shareholder's stock basis is reduced by flow-through losses before accounting for distributions.

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Where the S corporation rules are silent, C corporation provisions apply.

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The maximum number of actual shareholders in an S corporation is:

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What method is used to allocate S corporation income or losses unless an election to the contrary is made) ?

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Pass-through S corporation losses can reduce the basis in the shareholder's loan to the entity, but distributions do not reduce loan basis.

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If an S corporation has C corporation E & P and passive investment income in excess of % of its gross receipts for consecutive taxable years, the S election is terminated at the beginning of the year.

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An S corporation can claim a deduction for its NOL amounts.

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You are given the following facts about a 50% owner of an S corporation.Compute her ending stock basis.

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A capital loss allocated to a shareholder always reduces the Other Adjustments Account.

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Which item does not appear on Schedule K of Form 1120S?

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NOL carryovers from C years can be used in an S corporation year against ordinary income.

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