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The Parent Consolidated Group Reports the Following Results for the Tax

question 108

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The Parent consolidated group reports the following results for the tax year. Determine each member's share of the consolidated tax liability, assuming that the members all have consented to use the relative taxable income tax-sharing method. Dollar amounts are listed in millions, and a 35% marginal income tax rate applies to all of the entities.  Parent  Subone  SubTwo  SubThree  Consolidated  Ordinary income $600$200$60($30)$830 Capital gain/loss 0020 (5) 15$1231 gain/loss 1300(55)0]75 Separate taxable  incomes $730$200$25($30) with a $5 capital loss  carryover Consolidatedtaxable income$920Consolidated taxliability$322Energy tax creditfrom SubOne(10)Net tax due$312\begin{array}{|c|c|c|c|c|c|}\hline &\text { Parent } & \text { Subone } & \text { SubTwo } & \text { SubThree } & \text { Consolidated } \\\hline \text { Ordinary income } & \$ 600 & \$ 200 & \$ 60 & (\$ 30) & \$ 830 \\\hline \text { Capital gain/loss } & -0- & -0- & 20 & \text { (5) } & 15 \\\hline \$ 1231 \text { gain/loss } & \underline{130} & -0- & (55) & -0] & \underline{75} \\\hline \begin{array}{l}\text { Separate taxable } \\\text { incomes }\end{array} & \$ 730 & \$ 200 & \$ 25 & \begin{array}{c}(\$ 30) \text { with a } \$ 5 \\\text { capital loss } \\\text { carryover }\end{array} & \\\hline \text {Consolidated}\\\text {taxable income}&&&&&\$920\\\hline \text {Consolidated tax}\\\text {liability}&&&&&\$322\\\hline \text {Energy tax credit}\\\text {from SubOne}&&&&&(10)\\\hline \text {Net tax due}&&&&&\$312\\\hline \end{array}

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