Alpha Corporation Owns 100 Percent of Beta Company, and Beta

question 86

Multiple Choice

Alpha Corporation owns 100 percent of Beta Company, and Beta owns 80 percent of Gamma, Inc., all of which are domestic corporations. Information for the three companies for the year ending December 31, 2011 follows: Which of the following statements is true?

• A) Alpha and Beta must file a consolidated income tax return, but must exclude Gamma from the consolidated return.
• B) Alpha, Beta, and Gamma must file a consolidated income tax return.
• C) Alpha, Beta, and Gamma must file separate income tax returns because the ownership of Beta is less than 100%.
• D) Alpha, Beta, and Gamma will probably not file a consolidated income tax return.
• E) Alpha, Beta, and Gamma may file separate income tax returns or a consolidated income tax return.

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Definitions:

French Right

Political groups or parties in France that uphold conservative, traditional, or right-wing ideologies and policies.

United Nations

An international organization founded in 1945 composed of member states, aimed at promoting peace, security, and cooperation among countries.

Britain

An island nation in the northwest of Europe, historically referring to the land of the Britons, and now more commonly associated with the United Kingdom.