Which of the Following Is True Concerning Capital Losses and Net

question 23

Short Answer

Which of the following is true concerning capital losses and net operating losses for corporations:
$\begin{array}{ll}\text { Capital loss } & \text { Net operating loss } \\a.\text { Carried back 5 years } & \text { Carried back 2 years } \\b.\text { Carried back 5 years } & \text { Carried forward 20 years } \\c.\text { Carried back 3 years } & \text { Carried forward 20 years } \\d.\text { Carried back 5 years } & \text { Carried forward 5 years } \\e.\text { Carried back 3 years } & \text { Carried forward 5 years }\end{array}$

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Definitions:

Partnership Capital

The total amount invested by all partners in a partnership, representing their ownership interest.

Income-sharing Ratio

The pre-agreed proportion in which partners or stakeholders share the generated income or losses.

LLP

A legal structure for a business that provides the owners with limited liability protection, typically used by professional services firms.

Net Income

The total profit of a company after all expenses and taxes have been deducted from revenues.