For the current taxable year, HIJ Inc. had gross receipts from operations of $23
ID: 2412895 • Letter: F
Question
For the current taxable year, HIJ Inc. had gross receipts from operations of $230,000, operating and other expenses of $310,000, and $120,000 of dividends that it received from a 45 percent-owned domestic corporation. For the current taxable year, HIJ Inc. has taxable income or a net operating loss of what amount?
A. $8,000 taxable income.
B. $40,000 taxable income.
C. $56,000 net operating loss.
D. $80,000 net operating loss.
Question 3
NOP Inc. had the following income and expenses during the current taxable year. Its income from operations was $250,000, its expenses from operations were $120,000, its dividends received (from a 30 percent-owned corporation)) were $80,000, and it made cash charitable contributions of $30,000
How much is NOP Inc.’s charitable contribution deduction for the current taxable year?
A. $14,600.
B. $21,000.
C. $26,000.
D. $30,000.
Explanation / Answer
Answer
2 ) = C ) 56000 is net operating loss
income 230000 + 120000 = 350000
less; expense = 310000
less; dividend received = 96000
taxable income = -56000
3 )
B ) 21000
total income = 250000 - 120000 + 80000
= 210000
maximum = 210000 * 0.10
= 21000