On December 28, 2012, the board of directors of Taupe Corporation, a calendar year, accrual method C corporation, authorized a contribution of land to a qualified charitable organization. The land (basis of $75,000, fair market value of $125,000) was acquired five years ago and held as an investment. For purposes of the taxable income limitation applicable to charitable deductions, Taupe has taxable income of $800,000 and $950,000 for 2012 and 2013, respectively. Describe the tax consequences to Taupe Corporation under the following independent situations.
Definitions:
Price Elasticity
A measure in economics that shows how the quantity demanded of a good or service responds to a change in its price.
Total Expenditures
The sum of all spending by consumers, businesses, and the government in an economy.
Price Elasticity
A reflection of how the market's demand for a good is affected by its price dynamics.
Midpoint Method
A technique used to calculate the elasticity of demand or supply between two points on a curve by averaging the two points' quantities and prices.
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