Identify Which of the Following Statements Is True

question 56

Multiple Choice

Identify which of the following statements is true.

• A)P Corporation receives a dividend from its 100%-owned subsidiary corporation S. P and S have filed consolidated tax returns for a number of years. The dividend payment is out of S's earnings and profits and reduces P's investment in S. The dividend is an intercompany transaction and excluded from P's gross income.
• B)The consolidated dividends-received deduction percentage for dividends received by one affiliated group member from another affiliated group member is always 100%.
• C)The dividends-received deduction claimed when a $50,000 dividend is received from a 100%-owned nonconsolidated life insurance company is $35,000 (ignoring any dividends-received deduction limitations).
• D)All of the above are false.

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Definitions:

Collect Like Terms

In algebra, to combine terms that have the same variables raised to the same power.

Simplify

To make (something) simpler or easier to understand or do.

Expression

In mathematics, a combination of symbols that represent a quantity or a relationship between quantities.

Simplify

To make something easier to understand or do.