Two Unrelated,calendar Year C Corporations Have the Following Taxable Income

question 84

Multiple Choice

Two unrelated,calendar year C corporations have the following taxable income for the current year:
Olive Corporation
Magenta Corporation
Taxable income
$70,000
$90,000
​
Magenta Corporation is a qualified personal service corporation.Based on these facts,their corporate tax liability is:

• A)$24,500 for Olive and $18,850 for Magenta.
• B)$24,500 for Olive and $31,500 for Magenta.
• C)$12,500 for Olive and $18,850 for Magenta.
• D)$12,500 for Olive and $31,500 for Magenta.
• E)None of the above.

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Definitions:

Upper Control Limit

In quality control, it represents the highest value on a control chart that a process variable can reach before it is considered to signal potential loss of control, necessitating investigation.

Acceptance Sampling

A statistical quality control method where a random sample of items from a lot is inspected to decide if the entire lot should be accepted or rejected.

Defects

Imperfections or faults in a product or process that deviate from the desired specifications, affecting quality.

Sigma Control Limits

Statistical boundaries set in process control that represent acceptable variations in product quality or process performance, typically associated with Six Sigma methodology.