Four Unrelated,calendar Year Corporations Are Formed on January 1,2016,and Have

question 188

Essay

Four unrelated,calendar year corporations are formed on January 1,2016,and have the following qualified organizational expenditures: $4,000 for Rust Corporation;$15,000 for Orange Corporation;$53,000 for Pearl Corporation;and $56,000 for Chestnut Corporation.What is the maximum deduction each can claim for 2016?

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Definitions:

Common Stock Dividend

A portion of a company's earnings distributed to shareholders of its common stock, typically in the form of cash or additional shares.

Common Shares Outstanding

The total number of shares of a company that are owned by shareholders, excluding shares owned by the company itself.

Treasury Stock

Shares previously counted among a company's outstanding shares but were later bought back by the business.

Par Value

The nominal or face value of a bond, share of stock, or coupon as stated by the issuer.