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Corporation P owns 93 percent of the outstanding stock of Corporation T. This year, the corporations records provide the following information: Corporation P Corporation T
Corporation P owns 93 percent of the outstanding stock of Corporation T. This year, the corporations records provide the following information:
Corporation P | Corporation T | |||||||
Ordinary operating income (loss) | $ | 540,000 | $ | (220,000 | ) | |||
Capital gain (loss) | (8,700 | ) | 6,400 | |||||
Section 1231 gain (loss) | (1,400 | ) | 5,800 | |||||
Required:
- Compute each corporations taxable income if each files a separate tax return.
- Compute consolidated taxable income if Corporation P and Corporation T file a consolidated tax return.
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