Identify which of the following statements is true. A. A corporation is a separate taxpaying entity that must file a tax return annually. B. A newly formed corporation must select its basic accounting method. C. The terms "regular corporation" and "C corporation" are synonymous. D. All of the above are true.

Question

Prince Kennedy

Business

27 June, 11:44

Identify which of the following statements is true. A. A corporation is a separate taxpaying entity that must file a tax return annually. B. A newly formed corporation must select its basic accounting method. C. The terms "regular corporation" and "C corporation" are synonymous. D. All of the above are true.

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Larissa Campbell · Answer 1

All of the above are true.

Explanation:

The following statements about a corporation is true.

1. A corporation is a separate taxpaying entity that must file a tax return annually.

A corporation is a legal entity that is separate and distinct from its owners. they can enter contracts, loan and borrow money, sue and be sued, hire employees, own assets, and pay taxes annually just like individuals.

2. A newly formed corporation must select its basic accounting method.

A newly formed corporation will have to choose its accounting method. Accounting method refers to the rules a company follows in reporting revenues and expenses. The two primary methods are accrual accounting and cash accounting.

3. The terms "regular corporation" and "C corporation" are synonymous.

The C corporation is the standard (or default) corporation under IRS rules. The S corporation is a corporation that has elected a special tax status with the IRS and therefore has some tax advantages, hence cannot be said to be regular but has obtained a special status by election.