A Taxpayer Incurs a Net Operating Loss in the Current

question 45

Multiple Choice

A taxpayer incurs a net operating loss in the current year.With respect to the application of the NOL

• A)the taxpayer will carry back the NOL three years first,then carry forward any balance for five years.
• B)the taxpayer must carry forward the loss and has up to 20 years to use it.
• C)the taxpayer can carry forward the loss indefinitely until there is sufficient taxable income to use it up.
• D)the taxpayer will first carry back the NOL for two years,then carry forward the balance for a period of 20 years,or the taxpayer can elect to only carry forward the loss for the 20-year allowable period.

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Definitions:

Average Product

The quantity of goods produced per unit of input, determined by dividing the overall output by the amount of input used.

Unit Of Input

A measurement of the amount of resources (labor, materials, etc.) used in the production of goods and services.

Average Product

The output per unit of input, calculated by dividing the total product by the quantity of input.