Pigeon Corporation Acquired an 80% Interest in Statue Company on January

question 5

Multiple Choice

Pigeon Corporation acquired an 80% interest in Statue Company on January 1,2014,for $90,000 cash when Statue had Capital Stock of $60,000 and Retained Earnings of $40,000.The fair value/book value differential was attributable to equipment with a 10-year (straight-line) life.Statue suffered a $10,000 net loss in 2014 and paid no dividends.At year-end 2014,Statue owed Pigeon $18,000 on account.Pigeon's separate income for 2011 was $150,000.Controlling interest share of consolidated net income for 2014 was

• A)$140,000.
• B)$141,000.
• C)$142,000.
• D)$150,000.

Understand the concepts of tax equity and tax efficiency.

Differentiate between progressive, proportional, and regressive taxes.

Recognize the potential trade-offs between equity and efficiency in tax systems.

Identify the principles of tax design that aim to minimize the economic burden.

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Definitions:

Contingency Table

A Contingency Table is a statistical tool used to analyze the relationship between two or more variables, presenting the frequency distribution in a matrix format.

Response Rate

The percentage of people who respond to a certain call-to-action out of the total number of people who were asked to take the action.

Rate of Return

A measure of the gain or loss on an investment over a specified period, typically expressed as a percentage of the investment's cost.

Census Conducted

Refers to the systematic collection, analysis, and publication of demographic, economic, and social data pertaining to all individuals in a particular area at a specified time.