A Parent Sold Land to Its Partially Owned Subsidiary During

question 4

Multiple Choice

A parent sold land to its partially owned subsidiary during the year at a loss.The subsidiary continues to hold the land at the end of the year.The amount to be reported as consolidated net income for the year should equal:

• A)the parent's separate operating income,plus the intercompany loss.
• B)the parent's separate operating income,plus the intercompany loss,plus the subsidiary's net income.
• C)the parent's separate operating income,minus the intercompany loss.
• D)the parent's separate operating income,minus the intercompany loss,plus the subsidiary's net income.

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Definitions:

Lifetime Learning Credit

A tax credit available for qualifying tuition and related expenses paid for higher education courses, aimed at promoting lifelong learning.

Qualifying Expenses

Expenses that are approved under tax law as deductible from gross income to reduce taxable income.

AGI Limitations

Thresholds or caps based on Adjusted Gross Income that limit eligibility for certain tax deductions, credits, or benefits.

Credit for The Elderly

A tax credit available to elderly taxpayers or those who are permanently and totally disabled, to reduce their income tax liability.