One of the Motivations for the Consolidated Return Rules Is

question 128

Short Answer

One of the motivations for the consolidated return rules is to discourage conglomerates from trafficking in the deductible of other entities.

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Definitions:

Consolidation Worksheet Entries

Journal entries used in preparing consolidated financial statements, helping to adjust and eliminate internal transactions between parent and subsidiary entities.

Fair Value

An estimate of the price at which an asset or liability could be exchanged in a current transaction between willing parties.

Unamortized Patent

The portion of a patent's cost that has not yet been expensed in the income statement over its useful life.

Amortization Expense

The systematic allocation of the cost of an intangible asset over its useful life.