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Question: 1. ParentCo and SubCo report the following items of income and deduction for the current year. ...
1. ParentCo and SubCo report the following items of income and deduction for the current year.
| ParentCo's | SubCo's Taxable | |
| Item | Taxable Income | Income |
| Income (loss) from operations | $100,000 | ($10,000) |
| § 1231 loss | (5,000) | |
| Capital gain | 15,000 | |
| Charitable contribution | 12,000 |
Compute ParentCo and SubCo's consolidated taxable income or loss.
a.$90,000
b.$81,000
c.$88,000
d.$90,500
Please show adjustments
Homework Answers
Income from Operations ($100,000 – $10,000) = $ 90,000
§ 1231 and Capital Gains and Losses [($5,000) +$15,000] = 10,000
Total = $100,000
Charitable Contribution (10% TI limit)(10,000)
Consolidated Taxable Income = 100000 - 10000 = 90,000
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1. ParentCo and SubCo report the following items of income and deduction for the current year....
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year for $100,000. B.I.G. had acquired the land several years ago
for $40,000. The consolidated return also reflects the operating
results of the parties: B.I.G. generated $130,000 income from
operations, and SubCo produced a $20,000 operating loss.
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consolidated taxable income.
b. Same as part (a), except that five years later...
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Pls help with the numbers in red.
Also, provide an explanation of your results! Thank you!
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