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1) Which of the following is not a government transfer payment? A. Food stamps. B. Social Security benefits. C. Unemployment compensation. D. Interest on T-Bills.

1) Which of the following is not a government transfer payment?

A.

Food stamps.

B.

Social Security benefits.

C.

Unemployment compensation.

D.

Interest on T-Bills.

E.

None of these.

2) Nawal, is a major shareholder in Nakhell Corp., received an interest-free loan from the corporation.

A.

If the loan is classified as an employer-employee loan, the corporations taxable income will not be affected by the imputation of interest.

B.

If Nawal uses the funds to take a vacation, the imputation of interest will increase her taxable income.

C.

If the loan is c.lassified as a corporation-shareholder loan, the corporations taxable income will increase as a result of the imputation of interest.

D.

All are accurate.

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