Parent and Subsidiary Corporations Are Members of an Affiliated Group

question 44

Essay

Parent and Subsidiary Corporations are members of an affiliated group.Their separate taxable incomes (before taking into account any dividends)are $75,000 and $85,000,respectively.Subsidiary Corporation receives a dividend from a less-than-20%-owned corporation of $7,500 and from an affiliated 100%-owned nonconsolidated insurance subsidiary of $40,000.Subsidiary distributes a dividend of $35,000 to Parent Corporation who also receives dividends of $5,500 from a less-than-20%-owned corporation.The consolidated dividends-received deduction is what?

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Definitions:

Biweekly

occurs or is done every two weeks or twice a week, depending on context.

Credit Balance

Occurs when the amount paid is greater than was due or the account is being paid in advance of service provided.

Processing Fee

A charge assessed for the handling, processing, or servicing of an application, transaction, or purchase.

Monthly Billing

A payment structure where charges for services or utilities are invoiced to customers every month.