In the current year, Lava Corporation, a C corporation, had operating income of $120,000 and a short term capital gain of $9,000 Also in the current year, Drab Partnership had operating income of $120,000 and a short term capital gain of $9,000 Neither Lava nor Drab made any distributions to its ow...

A C corporation is a separate taxable entity Form 1120 and its taxable income has no effect on the ...

In the current year, Lava Corporation, a C corporation, had operating income of $120,000 and a short-term

Question:

In the current year, Lava a C had operating income of $120,000 and a short-term capital gain of $9,000. Also in the current year, Drab had operating income of $120,000 and a short-term capital gain of $9,000. Neither Lava nor Drab made any distributions to its owners. Abdul owns 40% of the stock in Lava and a 40% interest in Drab Contrast the current year's tax treatment of these transactions to the entities and to Abdul.
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Partnership
A legal form of business operation between two or more individuals who share management and profits. A Written agreement between two or more individuals who join as partners to form and carry on a for-profit business. Among other things, it states...