Cardinal and Bluebird Corporations Both Use a Calendar Year as Their

question 53

Multiple Choice

Cardinal and Bluebird Corporations both use a calendar year as their tax year. At the close of business on June 30, Cardinal Corporation buys all of Bluebird Corporation's stock. If the two corporations file a consolidated return and both corporations earn their income evenly throughout the year, what portion of Cardinal's income will be included in the consolidated return? (Assume all months have 30 days.)

• A) 100%
• B) 0%
• C) 50%
• D) none of the above