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C: 3-1 High Corporation incorporates on May 1 and...

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C: 3-1 High Corporation incorporates on May 1 and begins business on May 10 of the current year. What alternative tax years can High elect to report its initial year?s income? C: 3-11 Why are corporations allowed a dividends received deduction? What dividends qualify for this special deduction? C: 3-18 Describe the three types of controlled groups. C: 3-39 Taxable Income Computation. Omega Corporation reports the following results for the current year: Gross profits on sales $120,000 Dividends from less-than-20%-owned domestic corporations 40,000 Operating expenses 100,000 Charitable contributions (cash) 11,000 a. What is Omega?s charitable contributions deduction for the current year and its charitable contributions carryover to next year, if any? b. What is Omega?s taxable income for the current year, assuming qualified production activities income is $20,000? C: 3-44 Ordering of Deductions. Beta Corporation reports the following results for the current year: Gross income from operations $180,000 Dividends from less-than-20%-owned domestic corporations 100,000 Operating expenses 150,000 Charitable contributions 20,000 In addition, Beta has a $50,000 NOL carryover from the preceding tax year, and its qualified production activities income is $30,000. a. What is Beta?s taxable income for the current year? b. What carrybacks or carryovers are available to other tax years? C: 3-52 Controlled Groups. Which of the following groups constitute controlled groups? (Any stock not listed below is held by unrelated individuals each owning less than 1% of the outstanding stock.) For brother-sister corporations, which definition applies? a. Judy owns 90% of the single classes of stock of Hot and Ice Corporations. b. Jones and Kane Corporations each have only a single class of stock outstanding. The two controlling individual shareholders own the stock as follows: Tom 60% 80% Mary 30% 0% c. Link, Model, and Name Corporations each have a single class of stock outstanding. The stock is owned as follows: Link Corp. 80% 50% Model Corp. 40% Link Corporation?s stock is widely held by over 1,000 shareholders, none of whom owns directly or indirectly more than 1% of Link?s stock. d. Oat, Peach, Rye, and Seed Corporations each have a single class of stock outstanding. The stock is owned as follows: Bob 100% 90% Oat Corp. 80% 30% Rye Corp. 60%

 

Paper#2230 | Written in 18-Jul-2015

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