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B c d may be claimed either as a deduction or as a

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Unformatted text preview: Be careful, interest expense to carry municipal bonds is not deductible. Choices "a", "b", and "d" are incorrect, per the above explanation. CPA-02225 Type1 M/C 110. CPA-02225 A-D May 90 II #36 Corr Ans: D PM#16 R 3-99 Page 25 In the consolidated income tax return of a corporation and its wholly-owned subsidiary, what percentage of cash dividends paid by the subsidiary to the parent is tax-free? a. b. c. d. 0% 70% 80% 100% CPA-02225 Explanation Choice "d" is correct. Rule: The dividends received deduction is increased to 100% of qualifying dividends received from a consolidated "parent-subsidiary affiliated group" of a common parent who owns at least 80% of the total value and 80% of the total voting stock of the "other" includible corporations, if elected. Choices "a", "b", and "c" are incorrect, per the above rule. CPA-02227 Type1 M/C 111. CPA-02227 A-D May 91 II #47 Corr Ans: B PM#17 R 3-99 Page 22 The corporate dividends received deduction: 56 © 2009 DeVry/Becker Educational Development Corp. All rights reserved. Maxixishere Pdf Collection Becker CPA Review, PassMaster Questions Lectu...
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