B c d 0 12500 27500 52500 cpa 02236 explanation choice

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Unformatted text preview: incorrect. S corporations cannot take the dividends received deduction. CPA-02230 Type1 M/C 112. CPA-02230 A-D May 91 II #48 Corr Ans: D PM#18 R 3-99 Page 16 During 1990, Nale Corp. received dividends of $1,000 from a 10%-owned taxable domestic corporation. When Nale computes the maximum allowable deduction for contributions in its 1990 return, the amount of dividends to be included in the computation of taxable income is: a. b. c. d. $0 $200 $300 $1,000 CPA-02230 Explanation Choice "d" is correct. Rule: The charitable deduction of a corporation is limited to 10% of its taxable income for the year in which the deduction was made computed without regard to the deduction for contributions, the deduction for dividends received, any net operating loss carryback to the tax year, and any capital loss carryback to the tax year. However, it does include the full amount of dividends received in the calculation. Choices "a", "b", and "c" are incorrect, per the above rule. CPA-02232 Type1 M/C 113. CPA-02232 A-D May 91 II #49 Corr Ans: A PM#19 R 3-99 Page 19 Foreign income taxes paid by a corporation: a. b. c. d. May be claimed either as a de...
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This note was uploaded on 06/14/2013 for the course ACCOUNTING Regulation taught by Professor Becker during the Fall '10 term at Keller Graduate School of Management.

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