Which of the Following Statements Is True

question 14

Multiple Choice

Which of the following statements is true?

• A) When an affiliated group elects separate taxation, an additional "secondary" tax needs to be calculated.
• B) An affiliated group filing a consolidated tax return must record on its own books its share of the consolidated provision for income tax.
• C) Nonaffiliated tax filing is less complex than filing a consolidated tax return since there is no impact of intercompany transactions when separate returns are filed.
• D) When an affiliated group elects joint taxation, an additional "secondary" tax needs to be calculated.

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Definitions:

Strip Bond

A bond that has had its coupon payments and principal repayment separated, creating zero-coupon securities from a regular bond.

Yield to Maturity

The total return anticipated on a bond if the bond is held until its maturity date, taking into account both interest payments and capital gain or loss.

Term to Maturity

The remaining time until a debt instrument, such as a bond or loan, reaches its due date and the principal must be repaid.

Priced

Determination of the value or amount that must be paid to acquire a good, service, or asset.