Which of the following statements is correct?

Multiple Choice

• The LIFO recapture tax precludes an S corporation from using the LIFO method.
• The LIFO recapture tax is paid in five annual installments.
• The LIFO recapture amount increases the corporation's adjusted basis in its inventory.
• The LIFO recapture tax does not apply to S corporations with no earnings and profits from prior C corporation years.
• None of the choices are correct.