Parent and Subsidiary Corporations Have Filed Calendar-Year Consolidated Tax Returns

question 16

Multiple Choice

Parent and Subsidiary Corporations have filed calendar-year consolidated tax returns for several years. Parent Corporation uses the cash method of accounting while Subsidiary Corporation uses the accrual method of accounting. If Parent lends Subsidiary money

• A)the interest expense is deductible when accrued.
• B)the interest expense and interest income may be reported in different consolidated return years.
• C)the interest income is reported when the interest expense is accrued by Subsidiary.
• D)the interest expense deduction is taken when Parent reports the interest income.

Understand the principles of digital audio creation and interface.

Differentiate between various scanner technologies and their applications.

Identify and troubleshoot common issues with multimedia device connectivity and performance.

Understand and apply basic principles of good professional conduct in a technical environment.

---

Definitions:

Net Income

The ultimate earnings of a company, arrived at by taking away all expenses, taxes, and costs from the total income.

Dividends

Earnings distributed by a corporation to its shareholders from its profit.

Annual Amortization

The process of gradually writing off the initial cost of an asset over a period typically corresponding to the asset's useful life.