Question

If an S corporation's beginning balance in OAA is zero, and the following transactions occur, what is the ending OAA balance?

1) $1,300
2) $7,600
3) $27,500
4) $23,300
5) None of these choices are correct.

Answer 1

To calculate the ending OAA balance, specific details regarding income, expenses, and other adjustments are needed, which the given question does not provide, hence a correct ending balance cannot be determined from the provided options.

Step-by-step explanation:

The subject of the question involves calculating the ending balance in the Accumulated Adjustments Account (OAA) for an S corporation, assuming the beginning balance is zero. However, the question does not provide the necessary transactions or amounts that would typically alter the OAA balance. The correct ending OAA balance cannot be determined with the given options (1) $1,300 2) $7,600 3) $27,500 4) $23,300 5) None of these choices are correct) as there is insufficient contextual information to tie these amounts to specific adjustments within the OAA. Without additional details regarding transactions such as income, expense, distributions, and other adjustments, one cannot accurately calculate the ending balance. For example, to find the accounting profit, you would subtract the explicit costs from the total revenues, which would be $1,000,000 - ($600,000 + $150,000 + $200,000) = $50,000.