A Corporation May Reduce Trade or Business Income by a Charitable

question 6

True/False

A corporation may reduce trade or business income by a charitable contributions made by the corporation, but the deduction is limited to 10% of taxable income, as adjusted.

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Definitions:

Net Price

The actual price paid for a product or service after deducting any discounts, rebates, or promotions.

Complement Method

Method of computing the net price directly, using the complement of the trade discount rate.

Trade Discounts

Discounts given to buyers that generally are based on the quantity purchased.

Net Price

The real cost incurred for a product or service once all discounts, rebates, or allowances have been subtracted.