Read and analyze the statements.I. The unused input tax of the dissolved corporation as of the date of merger or consolidation shall be absorbed by the surviving or new corporation.II. Real property held for investment declared as property dividends to shareholders are considered as transactions deemed sale for VAT purposes.Select one:a.False, trueb.False, falsec.True, falsed.True, trueClear my choice
Question
Read and analyze the statements.I. The unused input tax of the dissolved corporation as of the date of merger or consolidation shall be absorbed by the surviving or new corporation.II. Real property held for investment declared as property dividends to shareholders are considered as transactions deemed sale for VAT purposes.Select one:a.False, trueb.False, falsec.True, falsed.True, trueClear my choice
Solution
The answer to your question depends on the specific tax laws of the country in question. However, generally speaking:
I. The unused input tax of the dissolved corporation as of the date of merger or consolidation shall be absorbed by the surviving or new corporation. This statement is generally true. In most jurisdictions, the surviving or new corporation will inherit the tax attributes of the dissolved corporation, including any unused input tax.
II. Real property held for investment declared as property dividends to shareholders are considered as transactions deemed sale for VAT purposes. This statement is also generally true. In many jurisdictions, the distribution of property dividends is considered a taxable event for VAT purposes, as it is deemed to be a sale of the property.
So, the answer would be:
d. True, true
Please note that tax laws can vary greatly from one jurisdiction to another, so you should consult with a tax professional to get the most accurate information for your specific situation.
Similar Questions
Revaluation of assets to fair value in a business combination will be accounted for:a) in the records of the subsidiary.b) on consolidation.c) either A or B.d) none of the above
If the carrying amount of an identifiable non-current asset of a subsidiary in a business combination is increased to fair value, on consolidation the group will record: a. A current tax liability. b. A deferred tax asset. c. A gain on bargain purchase. d. None of the above.
On dissolution of the firm, partners’ capital accounts are closed throughRealisation A/cDrawing A/cBank A/cLoan A/c
Which of following statements is not correct in relation to the consolidation process?Group of answer choicesTo avoid double counting of the group's equity, the equity of the subsidiary at the acquisition date needs to be eliminated from the records of the subsidiary.Subsequent to the acquisition date, any intragroup transactions within the group needs to be adjusted and eliminated.The fair value adjustments of assets that were not previously recorded by the subsidiary are recognised in the business combination valuation entries.Consolidated financial statements should offset the carrying amount of the parent's investment in the subsidiary.
14. Which of the following is not a direct source of value in a merger?a. Tax synergyb. Better investment policyc. Diversification synergyd. Growth synergy
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.