Kite Corporation, a Calendar Year Taxpayer, Has Taxable Income of $360,000

question 65

Essay

Kite Corporation, a calendar year taxpayer, has taxable income of $360,000 for 2018.Among its transactions for the year are the following: $\begin{array}{lr}\text { Collection of proceeds from insurance policy on life of corporate }\\\text { officer (in ex cess of cash surrender value) } & \$ 9,000 \\\text { Realized gain (not recognized) on an involuntary conversion } & 10,000 \\\text { Nondeductible fines and penalties } & 21,000\end{array}$ Disregarding any provision for Federal income taxes, determine Kite Corporation's current E & P for 2018.

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Definitions:

Affiliate Dividends

Affiliate dividends refer to the distribution of earnings paid to shareholders of a subsidiary or an affiliate company.

Outstanding Shares

The total number of shares of a corporation that have been issued and are currently held by investors, including public shareholders and company officers.

Dividends Paid

The portion of a company's earnings that is distributed to its shareholders as a return on their investment.

Investment Account

An account held at a financial institution which allows an individual to deposit funds and make investments in securities and other assets.