The Amount of a Farming Loss Cannot Exceed the Amount

question 26

True/False

The amount of a farming loss cannot exceed the amount of the taxpayer's NOL for the taxable year.

---

Definitions:

Cumulative Effect

The total impact of a change in accounting principle on the net income reported in prior periods, if that change had been applied retrospectively.

Accounting Principle

A fundamental guideline or rule that underpins the financial reporting and accounting practices.

Common Shares Outstanding

The total number of shares of a corporation's stock that are currently owned by investors, including those held by institutional investors and company officers.

Net Income

The total earnings of a company after deducting all expenses, including taxes and operating costs, from its total revenue.