ParentCo,SubOne and SubTwo Have Filed Consolidated Returns Since 2009

question 93

Multiple Choice

ParentCo,SubOne and SubTwo have filed consolidated returns since 2009.All of the entities were incorporated in 2008.Taxable income computations for the members include the following.None of the group members incurred any capital gain or loss transactions during these years,nor did they make any charitable contributions.

How should the 2010 consolidated net operating loss be apportioned among the group members?
ParentCo SubOne SubTwo

• A)$60,000 $ 0 $ 0
• B)$20,000 $20,000 $20,000
• C)$ 0 $20,000 $40,000
• D)$ 0 $40,000 $20,000

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Definitions:

Laspeyres Price Index

A price index used to measure the change in the cost of purchasing a fixed basket of goods and services over time, based on the quantities purchased in the base period.

Consumption Bundle

A set of goods or services that an individual or household chooses to consume within a given period, reflecting their preferences and budget constraint.

Prices

Monetary values assigned to goods and services, determining what amount of money is needed to purchase them.

Laspeyres Price Index

A measure of the change in the aggregate price level of a basket of goods and services over time, using the quantities purchased in the base year.