LO.6 Senior, Ltd., acquires all of the stock of JuniorCo for $30 million at the beginning of 2011. The group immediately elects to file income tax returns on a consolidated basis.

Senior’s operations generate a $50 million profit every year. In 2012, JuniorCo pays its parent a $9 million dividend. Operating results for JuniorCo are as follows.

2011 $ 4 million 2012 12 million 2013 15 million

a. Compute Senior’s basis in the JuniorCo stock as of the end of 2011, 2012, and 2013.

b. Same as (a), except that JuniorCo’s 2012 tax year produced a $6 million NOL.

c. Same as (a), except that JuniorCo’s 2012 tax year produced a $40 million NOL.