1. A consolidated group reports a net operating loss for the tax year. As a result:

a.The group carries the loss back 1 year and forward 5 years.

b.The group carries the loss forward 20 years, but no carryback is allowed.

c.The group carries the loss back 1 year and forward 20 years.

d.The group carries the loss back 2 years and then forward 20 years.

2. The Maestro consolidated group reported the following taxable income amounts. Parent owns all of the stock of both Junior and Minor. Determine the net operating loss (NOL) that is apportioned to Parent.

Parent	($400,000)
Junior	($600,000)
Minor	$100,000

a.$360,000.

b.$500,000.

c.$400,000.

d.$900,000. All NOLs of a consolidated group are apportioned to the parent.

3. Azure Corporation leaves the Colorful Corporation Federal consolidated return group on the last day of year 1. As a result:

a.Azure files its own Form 1120 beginning with year 2.

b.Azure's leaving the group is effective only when IRS permission to do so is granted.

c.The existing Colorful consolidation election is terminated.

d.Azure's tax results are included in the group's consolidated Form 1120 for the final time for year 2.