For This Tax Year, Madison Corporation Had Taxable Income of $80,000

question 89

Multiple Choice

For this tax year, Madison Corporation had taxable income of $80,000 before using any of the net operating loss from the previous year. Madison has never elected to forgo the carryback of its losses since incorporation five years ago. Madison's books and records reflect the following income (loss) since its incorporation. What amount of taxable income (loss) should Madison report on its current tax return?

• A)$45,000
• B)$65,000
• C)$70,000
• D)$80,000

---

Definitions:

Bonds

Long-term debt securities issued by corporations, governments, or other entities to finance operations or projects, which obligate the issuer to pay interest to bondholders.

Accrued Interest

The interest that has accumulated on a bond or loan since the last interest payment was made but has not yet been paid to the lender.

Long-Term Investment

Assets purchased by a company that are intended to be held for more than one year for the purpose of earning returns on the investment over time.