The Liquidation of a Subsidiary Corporation Must Be Completed Within

question 68

True/False

The liquidation of a subsidiary corporation must be completed within one tax year to receive nonrecognition treatment.

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Definitions:

CICA Handbook

The Canadian Institute of Chartered Accountants Handbook, which contains accounting and assurance standards in Canada.

Capitalize

To record a cost as a long-term asset rather than an expense, spreading the cost over its useful life.

Amortize

To amortize means to gradually pay off or write down the cost of an asset or debt over a period, often through regular payments.

Immediate Write-Off

The process of fully expensing an asset or expenditure in the current period instead of spreading its cost over its useful life.