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

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Definitions:

Domestic

Pertaining to or related to the home, household, or one's own country versus foreign or international counterparts.

Foreign Economies

Refers to the economies of other nations outside of one's own, considering differing political, economic, and cultural contexts in international trade and relations.

Parity Ratio

A measure comparing the value of one set of goods, services, or incomes to another set, often used in agriculture, trade, or economics for comparative analysis.

Farmers

Individuals or entities involved in the practice of agriculture, raising living organisms for food or raw materials.