QUESTION 21 Which of the following events will terminate an Selection of an S Corporation? O An estate becomes a shareholder in the S Corporation. The S Corporation issues Preferred Stock in addition to Common Stock The S Corporation has a large amount of Section 1245 (Depreciation Recapture) Income. The S Corporation receives a small amount of Passive Investment Income during the current year. QUESTION 7 Nanette receives a distribution or $170,000 from Johnson Corporation ans Corporation, in which she is the sole (one hundred percent (100%) shareholder Johnson Corporation has an Accumulated Adjustments Account (AAA) of $22,506 and Accumulated Earnings And Profits (AEP) of $2,500. Nanette's basis in her stock in Johnson Corporation is $30,000. The amount of Ordinary Income (Dividends) recognized by Nanette as a result of this distribution is $137.500 True False QUESTION 8 Melvina, an individual, owns forty percent (40%) of the Norman Company for which her basis is $100,000. Melvina sells one-half(1/2) of her ownership interest to Walker for $80,000. If Norman Company is an S Corporation, Melvina has a Recognized Gain of $30,000 some of which may be Capital Gain and some may be Ordinary income. False True